The state’s revenue collections for the month of December were higher than budgeted yielding a $156.4 million surplus, Tennessee Department of Finance and Administration Commissioner Butch Eley announced Monday.
On an accrual basis, December marks the fifth month of the 2021-2022 fiscal year.
December’s revenues mark the sixth month in a row of budget surpluses, now totaling $732.8 million.
The higher-than-anticipated total revenues for December were 11.6 percent ahead of the budget and represented a nearly 8 percent increase over the revenues collected in December 2019.
“Total tax revenues for December exhibited remarkable growth compared to last year and were boosted by gains from both sales and corporate tax receipts,” Eley said in his monthly report on revenues.
The state’s franchise and excise tax on corporations made up 77 percent of the surplus by being $120.5 million or 40 percent over budget. Those revenues are also up 15 percent or $54.8 million as compared to December 2019.
In addition to being $259.7 million and 33 percent ahead for the year, franchise and excise tax collections were more than 3 percent over the same period in 2019.
Eley, commenting on corporate tax collections, said, “while volatile on a monthly basis, also demonstrated notable growth over this same time last year with nearly 87 percent of the growth coming from increased quarterly estimated tax payments.”
Meanwhile, Eley said the state’s sales tax, “representing November taxable sales and the early holiday shopping season, continues to signify strong consumer activity during the ongoing pandemic.”
Sales tax collections were $28.4 million and nearly 3.5 percent over budget for December as well as being $52.5 million or 6.5 percent higher than December of last year.
For the year, sales tax is $435.4 million and more than 11 percent ahead of the budget and $201.6 million or nearly 5 percent higher than this time last year.
Eley said that the January revenue report issued next month will fully capture consumer spending for the Christmas holiday season.
The state’s income, motor vehicle title, mixed drink, severance and coin operated amusement taxes as well as TVA’s in-lieu-of-tax payments combined were $6 million below the budgeted estimates.
Of greater significance is that the gas, special petroleum and motor vehicle fuel taxes are below estimates for the month and the year-to-date. All three taxes also reflect a decrease as compared to December 2019 and year-to-date 2019.
However, the Highway Fund remains nearly $4.7 million and 1.1 percent ahead of the budget, even though it is $31.3 million and nearly 7 percent less than this time in 2019.
The full announcement on December revenues issued by Tennessee Department of Finance and Administration Commissioner Butch Eley can be read here.
The detailed tables of Tennessee revenue collections by tax for December and year-to-date can be viewed here.
Laura Baigert is a senior reporter at The Tennessee Star.