News release from the Department of Finance and Administration
NASHVILLE, Tenn. – Tennessee tax revenues exceeded budgeted estimates in March. Department of Finance and Administration Commissioner Larry Martin today announced that overall March revenues were $1.1 billion, which is $133.0 million more than the state budgeted. March revenues reflect business activity that occurred in February.
“The sales tax growth rate for March was the highest we’ve seen this year, due in part to negative growth in March of last year, and also having one additional day of business activity in the leap year,” Martin said. “Franchise and Excise taxes recorded strong growth for the month and were also significantly higher than the budgeted estimate. All other taxes, taken as a group, exceeded the March estimate as well.
“We continue to be pleased with the overall growth in total taxes this fiscal year, but we also have concerns about slowing global growth and volatile financial markets.”
On an accrual basis, March is the eighth month in the 2015-2016 fiscal year.
General fund revenues were more than the budgeted estimates in the amount of $125.5 million, while the four other funds that share in state tax revenues were $7.5 million more than the estimates.
Sales taxes were $47.6 million more than the estimate for March and were 15.46% more than March 2015. For eight months, revenues are $273.9 million higher than estimated. The year-to-date growth rate for eight months was 7.89%.
Franchise and excise taxes combined were $70.0 million more than the budgeted estimate in March, and the growth rate over March 2015 was positive 27.46%. For eight months, revenues are $211.1 million more than the estimate and the year-to-date growth rate is 5.73%. However, adjusting for last year’s one-time payment the underlying growth rate is positive 21.05%.
Gasoline and motor fuel revenues for March increased by 4.10% compared to March 2015 and $3.3 million more than the budgeted estimate of $60.1 million. For eight months, revenues have exceeded estimates by $23.2 million.
Tobacco taxes were $3.6 million above the March budgeted estimate of $18.7 million. For eight months, they are $12.0 million more than the budgeted estimate.
Inheritance and estate taxes were $0.9 million less than the March estimate. On a year-to-date basis, revenues for eight months are $8.4 million more than the budgeted estimate.
Privilege taxes were $1.9 million more than the March estimate, and on a year-to-date basis, August through March, revenues are $16.8 million more than the estimate.
Business taxes were $3.7 million more than the March estimate. For eight months, revenues are $6.6 million more than the budgeted estimate.
All other taxes were above estimates by a net of $3.8 million.
Year-to-date revenues for eight months were $572.1 million more than the budgeted estimate. The general fund recorded $532.5 million above budgeted estimates and the four other funds $39.6 million.
The budgeted revenue estimates for 2015-2016 are based on the State Funding Board’s consensus recommendation of December 16, 2014 and adopted by the first session of the 109th General Assembly in April 2015. Also incorporated in the estimates are any changes in revenue enacted during the 2015 session of the General Assembly. These estimates are available on the state’s website at http://www.tn.gov/finance/article/fa-budget-rev.