State Tax Revenues in May Exceeded Budgeted Estimates, per Tennessee Department of Finance and Administration

The Tennessee Department of Finance and Administration announced Tuesday that overall May state tax revenues exceeded budgeted estimates. On an accrual basis, May is the 10th month in the 2021-2022 fiscal year.

ICYMI: @TNDeptofRevenue and F&A release May revenue collections. https://t.co/mE4m8I0BIF pic.twitter.com/hbMmpGU6dU

— TN Dept of F&A (@TNDeptofFandA) June 15, 2022

Revenues for May totaled $1.6 billion, which is $327.4 million more than the budgeted monthly revenue estimate according to a press release by the department. State tax revenues were $41.8 million more than May 2021 and the overall growth rate was 2.66 percent.

General fund revenues were more than the budgeted estimates in the amount of $303.4 million and the four other funds that share in state tax revenues were $24 million more than the estimates, the department notes.

The following numbers are reported as presented in the press release by the Tennessee Department of Finance and Administration:

• Sales tax revenues were $272.2 million more than the estimate for May and 9.31% more than May 2021. For ten months, revenues are $2 billion higher than estimated. The August through May growth rate is 15.8%.
• Franchise and excise tax revenues combined were $33.3 million greater than the budgeted estimate in May, and the growth rate compared to May 2021 was negative 0.18%. For ten months, revenues are $1.4 billion more than the estimate and the year-to-date growth rate is 34.05%.
• Gasoline and motor fuel revenues for May decreased by 6.79 % compared to May 2021, but they were $0.3 million more than the budgeted estimate of $100.8 million. For ten months, revenues are more than estimated by $46.5 million.
• Motor vehicle registration revenues were $2.8 million more than the May estimate, and on a year-to-date basis, revenues are $17.7 million more than the estimate.
• Tobacco tax revenues were $0.2 million less than the May budget estimate of $20.6 million. For ten months, they are $1.7 million less than the budgeted estimate.
• Privilege tax revenues were $7.3 million more than the May estimate but decreased 14.67% from May 2021. On a year-to-date basis, August through May, revenues are $146.2 million more than the estimate.
• Business tax revenues were $4.6 million more than the May estimate. For ten months, revenues are $41.6 million more than the budgeted estimate.
• Mixed drink, or Liquor-by-the-drink, taxes were $7.8 million more than the May estimate. For ten months, revenues are $46.3 million more than the budgeted estimate.

All other tax revenues were less than estimated by a net of $0.7 million, according to the department.

“May tax revenues reflect an increase compared to this time last year, although monthly growth was much lower for May compared to all other months that have reported year-to-date,” Tennessee Department of Finance and Administration Commissioner Butch Eley said in a statement. “Sales tax revenue receipts continue to remain elevated, but corporate taxes held nearly flat when compared to May of last year. Monthly growth was also limited by the full phase out of the Hall income tax, which resulted in a decline of $39.7 million, and a shift of approximately $20 million in professional privilege tax payments that will be recaptured next month. With two months remaining in the fiscal year, we will continue to monitor revenue and expenditures to keep Tennessee fiscally strong, especially as we see continued sharp increases in the consumer-price index that will likely have future economic effects.”

According to the press release, year-to-date revenues, for ten months, are $3.7 billion more than the budgeted estimate. The general fund recorded $3.5 billion more than the budgeted estimate and the four other funds were $209.1 million more than estimated.

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Kaitlin Housler is a reporter at The Tennessee Star and The Star News Network.