Tag Archives: revenue

August state revenue $38M better than budget

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Tennessee revenues exceeded the budgeted estimates for August, which is the first month of the state’s fiscal year. Finance and Administration Commissioner Larry Martin today reported that overall August revenues were $948.2 million, which is $49.8 million more than August of last year and $38.0 million more than the budgeted estimate. The growth rate for all taxes in August was 5.54%.

“Corporate tax receipts and sales tax revenue reflecting July’s consumer activity posted positive growth for the month,” Martin said. “All other taxes revenues, taken as a group, also recorded positive growth.

“The positive revenue numbers for August reflect a continuing good economic environment in our state. It should be noted, however, that the sales tax, which is our largest revenue source, grew at a moderate rate of 2.2%. This is well below the average growth of 7.3% over the first six months of the calendar year.” Continue reading →

Administration asks 2 percent budget cut plans

Despite a growing government budget surplus in Tennessee, Finance Commissioner Larry Martin has asked all department chiefs to submit proposals for cutting their spending by 2 percent in the next fiscal year.

In a memo to department and agency officials, Martin acknowledges “strong revenue growth” but cites enactment of a law earlier this year that cuts the Hall tax on investment income from 6 percent to 5 percent immediately and mandates full repeal in six years.

“At a minimum, reductions will be necessary to offset the phaseout of the Hall Income Tax,” the memo says. “In fiscal year 2014-15, collections for the Hall tax totaled $303.4 million. Because certain areas of the budget tend to outpace our average revenue growth, it would not be prudent to address tax cuts with revenue growth alone. It’s also important that we continue to look for savings and efficiencies throughout state government and bend the curve on government spending.” Continue reading →

TN fiscal year revenue $925M over estimates

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Total Tennessee tax revenues for July were slightly more than the budgeted expectation. Finance and Administration Commissioner Larry Martin reported today that July, which ended the accrual fiscal year, recorded a net positive growth of 0.74%, compared to July of 2015. Overall, July revenues were $1.0 billion, which is $13.8 million more than the state budgeted.

“July revenue results were somewhat mixed,” Martin said. “With sales taxes, we had stronger than anticipated growth but corporate and business taxes experienced negative growth. Also, all other taxes, taken as a group, were marginally below July 2015.

“Despite the mixed results in July, the year-to-date growth rate for all taxes ended the year well above last year’s revenue performance. It is important to note that despite the underperformance with corporate business taxes in July, year to date these taxes have a strong positive growth.” Continue reading →

On proposed TN tax collection by out-of-state retailers

A proposed Tennessee Revenue Department rule that would require out-of-state retailers to begin collecting Tennessee sales taxes on items sold here is pitting state-based retailers who use the internet, catalogs and cable to sell across the country against traditional brick-and-mortar stores that don’t.

Further from the Times-Free Press:

At a departmental hearing on the proposed rule Monday, opponents testified against the plan to require remote sellers with no physical presence in Tennessee to begin collecting sales taxes from in-state buyers in 2017.

States like Tennessee require in-state retailers to collect state and local sales taxes. But two U.S. Supreme Court decisions, the second one rendered back in 1992 before the explosion of the internet and internet commerce, bar states from requiring sellers with no physical presence in their state to collect sales taxes.

While representatives for traditional brick-and-mortars didn’t testify, they filed letters in support of the proposed rule, which would require out-of-state vendors who sell to Tennesseans to charge state and local sales taxes that can hit 9.75 percent.

Opponents’ chief concern is that other states may retaliate.

“While the rule appears to be targeted only at out-of-state sellers, it could actually cause a boomerang effect that would bring real and serious harm to retailers and businesses right here in Tennessee,” said a group of five businessmen and businesswomen in a letter to the Department of Revenue.

They warned the Haslam administration’s proposed regulation “would encourage other states to impose similar obligations on Tennessee businesses that sell to customers in other states — a situation that could lead to a chaotic patchwork of tax regulations and laws that reach beyond state borders and into Tennessee.”

June state revenue $112.8M above budget prediction

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Newest figures show that total tax revenues in the month of June were more than budgeted expectations. Finance and Administration Commissioner Larry Martin reported today that June ended with a net positive growth of 6.16% compared to taxes in the same month last year. Overall June revenues were $1.3 billion, which is $112.8 million more than the state budgeted.

“June sales tax revenues recorded much slower growth than previous months, which was not expected,” Martin said. “However, June brought us stronger than anticipated collections from corporate business taxes and well above budgeted expectations for all other tax sources combined.”

On an accrual basis, June is the eleventh month in the 2015-2016 fiscal year.

General fund revenues exceeded the budgeted estimate in the amount of $105.3 million. The four other funds that share in state tax revenues were also in excess of budgeted expectations by $7.5 million.

Sales tax revenues were $1.2 million more than the estimate for June. The June growth rate was 1.28%. For eleven months revenues are over budget by $346.2 million. The year-to-date growth rate for eleven months was 7.18%. Continue reading →

Haslam moves to require online retailers collect TN sales tax

Gov. Bill Haslam wants Tennessee to join a growing group of states seeking to force either Congress or the U.S. Supreme Court to revisit rulings preventing collection of sales taxes from out-of-state online retailers. reports the Times-Free Press.

State Department of Revenue officials will hold a rulemaking hearing in August on a proposed rule that administration officials hope will tear down that barrier and let the tax dollars roll in.

The rule would require out-of-state online companies with more than $500,000 a year in Tennessee sales to collect and remit sales taxes to the state starting July 1, 2017.

Adopting the rule is a multistep process. If adopted, it’s virtually certain to be challenged in court. And that’s the primary objective of the strategy being pushed by states like Alabama, South Dakota and now Tennessee.

At least a dozen states are pushing a patchwork of laws or rules they hope will pressure Congress to act or, more likely, force the issue back before the Supreme Court.

“The governor has been out front on this issue and trying to get something through Congress,” Haslam press secretary Jennifer Donnals told the Times Free Press in an email.

If Tennessee is successful, Donnals added, “we would also look at reductions on the sales tax on food to be as cost neutral as possible.”

…Tennessee revenue officials estimate a loss of $300 million to $450 million in sales tax collections annually. The National Conference of State Legislatures estimates states collectively lost out on $23.3 billion in 2012.

“Tennessee is a sales tax-driven state, and we have to be fair to our local businesses,” state Revenue Commissioner Richard Roberts said by email.

Roberts called the status quo “fundamentally unfair” to local retailers. “Just this past year more Americans shopped online over the Thanksgiving-Black Friday weekend than went to stores,” he said.

State revenue $41M over budget in May

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Tennessee tax revenues exceeded budgeted estimates in May, driven primarily by sales taxes. Department of Finance and Administration Commissioner Larry Martin today announced that overall May revenues were $1.0 billion, which is $41.3 million more than the state budgeted.

“Total reported receipts in May reflect significant improvement over this time last year, and were driven primarily by sales tax receipts,” Martin said. “Franchise and excise taxes fell short of May 2015 figures and were also below the monthly budgeted estimate. All other tax collections, taken as a group, were above the May estimate.”

On an accrual basis, May is the tenth month in the 2015-2016 fiscal year.

General fund revenues were more than the budgeted estimates in the amount of $37.4 million while the four other funds that share in state tax revenues were $3.9 million more than the estimates.

Sales taxes were $33.5 million more than the estimate for May and were 6.49% more than May 2015. May receipts reflect retail business activity that occurred in April. For ten months, revenues are $345.0 million higher than estimated. The year-to-date growth rate for ten months was 7.81%. Continue reading →

State’s April revenues $185M above estimates

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Tennessee tax revenues exceeded budgeted estimates in April. Department of Finance and Administration Commissioner Larry Martin today announced that overall April revenues were $1.8 billion, which is $185.0 million more than the state budgeted.

“Total reported revenues in April reflect significant improvement over this time last year in both sales and business taxes,” Martin said. “While franchise and excise taxes and income tax revenues are typically large in the month of April, much of the state’s revenue growth is a result of strong sales taxes, reflecting consumer confidence in Tennessee.”

On an accrual basis, April is the ninth month in the 2015-2016 fiscal year.

General fund revenues were more than the budgeted estimates in the amount of $165.9 million while the four other funds that share in state tax revenues were $19.1 million more than the estimates.
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March revenue adds $133M to state budget surplus

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.”
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State wins $13M tax fight with Verizon Wireless

News release from Administrative Office of the Courts
Nashville, Tenn. – The Tennessee Supreme Court has upheld a decision by the Tennessee Department of Revenue to impose a tax variance on the parent company of Verizon Wireless. The Court held that the Commissioner of Revenue was within his authority to impose the variance, in order to keep the company from avoiding paying Tennessee franchise and excise taxes on over a billion dollars in revenue from sales to Tennessee customers.

The lawsuit was filed by Vodafone Americas Holdings, Inc., a multistate wireless telecommunications corporation, and its subsidiaries (Vodafone), doing business throughout the United States as Verizon Wireless.

From 2000-2006, Vodafone filed Tennessee franchise and excise tax returns and paid taxes totaling more than $13 million on the revenues Vodafone received for services provided to its Tennessee customers. In 2007, Vodafone filed a lawsuit asking the trial court to require the Department of Revenue to refund nearly all of the Tennessee franchise and excise taxes Vodafone had paid for the years 2002 through 2006. Vodafone claimed that, if the apportionment formula in Tennessee’s franchise and excise tax statutes were applied correctly, Vodafone would owe virtually no taxes on its sales receipts for cell phone services provided to Tennessee customers, receipts that totaled over a billion dollars in revenue to Vodafone.
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