State revenue finishes up for year ending June 30 | Arkansas Blog

Tuesday, July 2, 2013

State revenue finishes up for year ending June 30

Posted By on Tue, Jul 2, 2013 at 10:38 AM

Here's the year-end report for Arkansas's 2013 budget year, which ended June 30.

There was a surplus of almost $300 million and net revenue was up 6.3 percent over the year before.

This isn't so robust as it might appear. Individual income tax revenue was affected by income shifting into tax year 2012 to avoid higher federal income tax rates and thus higher estimated tax payments. Withholding from wagers increased only modestly.

Sales and use tax collections — a backbone of revenue — increased only 1.1 percent, against expected growth of 2.5 percent. Corporate income tax collections were 1 percent below collections last year. The state also spent less than expected on school desegregation payments and economic development incentives.

So, though the Tea Party might lust for more tax breaks (and several were extended in this legislative session, including to rich people with a capital gains tax cut), these numbers don't seem to argue for room for another general reduction. At least not without commensurate cuts and services.

However, gross revenue in June alone was up 6.9 percent over last year and sales taxes were up more than 3 percent in that figure. So the trend isn't terrible.

All of which reminds me: A bottom line seems to be developing on the controversy over parole and probation practices. More paroles are going to be revoked. More offenders are going to be going back to state prison or other forms of detention. This costs a lot of money.

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