Robert R. Bliss
Collections fall $188 million short of monthly benchmark; year to date collection now $223 million below FY09 benchmark excluding one-time $80.3 million corporate settlement received in July
Revenue Commissioner Navjeet K. Bal today announced that preliminary revenue collections for September 2008 totaled $2.100 billion, which is $188 million below the monthly benchmark based on the FY09 revenue estimate of $21.402 billion.
Total tax collections for September were $108 million or 4.9 percent less than a year ago. Tax collections for the first quarter of the fiscal year are now $143 million below the year-to-date consensus benchmark on which the current budget was built, and would have been $223 million below benchmark if not for a one-time corporate settlement of $80.3 million received in July.
"Weakness in withholding, sales and corporate/business tax collections dropped total revenues well below the monthly benchmark, which in turn caused collections for the year to fall below the benchmark for the first quarter of FY09," Bal said.
Estimated payments collections totaled $515 million, $4 million more than a year ago and $5 million above the monthly benchmark. However, Bal warned that given current national and regional economic conditions, it is expected that estimated payments, and in particular, capital gains collections, will decline over the course of the fiscal year as taxpayers adjust those quarterly payments to reflect less income realized from capital gains and other sources of dividend and interest income.
"It is important to remember that the current FY09 consensus revenue estimate includes a 13 percent decline in capital gains tax revenue from the amount received in FY08. We will be closely watching collections in January and April of 2009 to see the extent to which taxpayers adjust downward their estimated payments and payments with final returns for the new tax year given recent losses in the stock market and in private equity and hedge funds," Bal said.
September withholding collections totaled $693 million, down $48 million or 6.4 percent from a year ago and $108 million below benchmark.
Corporate/business tax collections for September totaled $391 million, down $60 million or 13.4 percent from the same period a year ago and $51 million below the benchmark due largely to declining corporate profits and to increased use of transferable tax credits.
Sales and use tax collections totaled $337 million, down $6 million or 1.8 percent from the same period last year and $23 million below benchmark. In addition, both motor fuels and deeds excise tax collections were down. Fuels tax collections totaled $58 million, down $2 million from a year ago while deeds excise collections totaled $13 million, down $8 million from a year ago.
Year to date, income tax collections are $53 million below benchmark; sales and use tax collections are $75 million below benchmark; and corporate and business tax collections are $14 million above benchmark thanks to the settlement received in July.
FY2009 Year-to-Date Tax Revenue through September 2, 2008
September 2008 Tax Collections Summary (in $ millions - preliminary as of October 2, 2008)