Robert R. Bliss
Lower than anticipated withholding taxes send monthly collections $86 million below revised benchmark
Revenue Commissioner Navjeet K. Bal today announced that preliminary tax revenue collections for February 2009 totaled $955 million, down $188 million or 16.4 percent from last February.
Total tax collections were $86 million below the February monthly benchmark corresponding to the FY09 tax revenue estimate of $19.450 billion, due largely to a decline in withholding taxes.
FY09 year-to-date tax collections total $11.805 billion, down $669 million or 5.4 percent below the same period a year ago, and are $62 million below the FY09 year-to-date benchmark corresponding to the FY09 estimate of $19.450 billion.
February is one of the smallest tax collection months of the year, as there are no quarterly or annual payments due. February tax collections are driven mainly by withholding and sales taxes, both of which were below the monthly estimate. "Withholding collections were affected by several timing-related changes between FY08 and FY09, as well as declining employment and reductions in bonus payments due to the recession. While it is possible that some of the timing-related withholding decline will be reversed in March, we will not know whether such a reversal will occur until the end of this month. February's collections reflect the downward pressure caused by the ongoing economic recession, and we will continue to monitor revenues closely as we head into bigger tax collection months," Commissioner Bal said.
February income tax collections totaled $498 million, down $34 million or 6.4 percent from a year ago, $52 million below the monthly benchmark. Weakness in withholding taxes, which totaled $808 million, down $22 million or 2.7% from a year ago, $94 million below the monthly benchmark, accounted for most of the February shortfall. Income tax refunds totaled $358 million, up $11 million or 3.2 percent from a year ago, $35 million below benchmark. February sales tax collections totaled $278 million, down $24 million or 7.8 percent from last year, $9 million below the monthly benchmark. Corporate and business taxes totaled $42 million, down $118 million or 73.6 percent from last year, $17 million below the monthly benchmark. Most of the corporate and business tax decline was the result of a non-recurring payment of $102 million that was received in February 2008 and was accounted for in the monthly benchmark, and thus did not contribute to the February below-benchmark performance.
On a year-to-date basis, income taxes are $392 million, or 5.3 percent below a year ago and $42 million below the benchmark. Sales and use tax collections are down $135 million, or 4.9 percent below the same period a year ago and $16 million below the benchmark. Corporate/business taxes are down $125 million, or 11.7 percent below the same period a year ago and $4 million above the benchmark.
FY2009 Year-to-Date Tax Revenue through February 28, 2009
February 2009 Tax Collections Summary (in $ millions - Preliminary as of March 2, 2009)
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