April 17, 2013 Utah State Tax Commission releases revenue report
The Tax Commission’s revenue report was released yesterday and a few data points may be worthwhile to note.
First, state sales taxes, which were running 4.1% ahead last month, fell by almost 1% to 3.2% growth for the first three quarters of the fiscal year. This may mean that sales tax distributions might be negative in ten days. Due to the large earmarks of state sales taxes to transportation, the monthly numbers are not as indicative of trends as they once were. So, I totaled all sales taxes (28 total) for the month and at $191 million, they were down 11.5% compared to the same month last year. Distributions may therefore be down between 6% and 12% this month (they were up 15% last month).
Second, individual income taxes, which were up 12.1% last month, dropped to 10.2% growth this month. This is consistent with what Tax Commission and Legislative Fiscal Analyst economists thought might happen as refunds processing is now catching up to normal. Still, 10.2% growth, which may eventually drop between 6% and 8% is good news.
Third, corporate franchise tax growth also fell, but is still very high at 42.1% through the first three quarters of fiscal year 2012-13.
Finally, motor fuel taxes fell 0.4% through the first three quarters. This pretty much flat growth is consistent with the fact that Utah’s automobile and truck fleet is becoming more and more efficient as new, higher mpg models are added each year, while more inefficient, older models are scrapped. It also underscores the plight of cities (and UDOT), who need a growing revenue source, not a flat one, to fund their roads.