State revenue still above estimates after 2 months

By Bobby Harrison/NEMS Daily Journal

JACKSON – State revenue collections missed the all-important revenue estimate for the month of August by $13.7 million, but there were extenuating circumstances.
In July, some unnamed retailers reimbursed to the state $17.6 million more in sales tax collections than they owed, according to the revenue report produced by the staff of the Legislative Budget Committee.
In August, the retailers were given credit for that accounting glitch. If not for that glitch, revenue collections for the month of August would have exceeded the estimate, as they have for more than a year previously.
Meeting the official revenue estimate, which is set by legislative leaders upon the recommendation of the state’s financial experts, is important because it represents the amount of money that is budgeted to fund state government.
If the estimate is not met, often cuts must be made in areas such as education, public safety, economic development and health care.
The state’s financial experts also urge that when using the revenue collections to gauge the strength of Mississippi’s economy, they should be viewed over a multi-month period and not for just one month.
For the first two months of the current fiscal year, which started July 1, collections are $13.4 million, or 2.3 percent, above the estimate. For the first two months, revenue collections are $15 million, or 2.6 percent, above the amount collected during the same period last year.
Sales tax collections for the first two months are $1.4 million, or 0.7 percent, below the estimate. The 7 percent tax on most retail items accounts for more than 39 percent of the total general fund revenue collections. Income tax collections, which account for more than 30 percent of general fund revenue, were $6.3 million, or 2.9 percent, above the estimate.
Corporate income tax collections showed a big jump in August at $1.9 million, or 12.7 percent, above the estimate, as did casino taxes, which were $3.6 million, or 32 percent, above the estimate.
bobby.harrison@journalinc.com