Press Release  April Revenue Collections Total $4.782 Billion

(Boston, MA) — Massachusetts Department of Revenue (DOR) Commissioner Geoffrey Snyder today announced that preliminary revenue collections for April totaled $4.782 billion, $2.163 billion or 31.2% less than actual collections in April 2022, and $1.435 billion or 23.1% below benchmark.^[1] April 2023 revenue collections were impacted by the elective pass-through entity (PTE) excise. After adjusting for DOR’s estimate of the net impact of PTE excise^[2], April 2023 collections are $1.447 billion or 20.2% below actual collections in April 2022, and $915 million or 13.8% less than benchmark.

FY2023 year-to-date collections through April totaled approximately $32.317 billion, which is $2.174 billion or 6.3% less than collections in the same period of FY2022, and $1.171 billion or 3.5% below the updated year-to-date benchmark^[3]. After adjusting for DOR’s estimate of the net impact of PTE excise^[2], FY2023 year-to-date collections are $406 million or 1.2% below actual collections in the same period of FY2022, and $841 million or 2.5% less than the updated year-to-date benchmark.

“The decrease in April collections in comparison to April 2022 is primarily driven by a decrease in non-withholding income tax,” said Commissioner Snyder. “The decline in non-withholding income tax is mostly attributable to a decrease in capital gain tax collections and an increase in PTE members applying credits to reduce their tax payments.”

Historically, April has been the single largest month for collections, ranking first of the twelve months in eight of the last ten years. There are two main causes for April’s relative strength. First, the individual tax filing season reaches its peak. Payments made with returns are concentrated in April, while refunds are spread across February, March, and April. Second, the first income estimated payment installment for the current tax year is due in April.

Details:

• Income tax collections for April totaled $3.125 billion, $1.558 billion or 33.3% below benchmark, and $2.129 billion or 40.5% less than April 2022.
• Withholding tax collections for April totaled $1.354 billion, $13 million or 0.9% below benchmark, but $75 million or 5.8% more than April 2022.
• Income tax estimated payments for April totaled $297 million, $24 million or 8.6% above benchmark, but $191 million or 39.2% less than April 2022.
• Income tax returns and bills for April totaled $1.991 billion, $1.589 billion or 44.4% below benchmark, and $1.980 billion or 49.9% less than April 2022.
• Income tax cash refunds for April totaled $517 million in outflows, $20 million or 3.8% below benchmark, but $32 million or 6.5% more than April 2022.
• Sales and use tax collections for April totaled $757 million, $17 million or 2.3% above benchmark, and $22 million or 3.0% more than April 2022.
• Meals tax, a sub-set of sales and use tax, for April totaled $103 million, $3 million or 3.1% below benchmark, but $5 million or 5.2% more than April 2022.
• Corporate and business tax collections for April totaled $674 million, $76 million or 12.6% above benchmark, but $21 million or 3.0% less than April 2022.
• “All other tax” collections for April totaled $225 million, $31 million or 15.8% above benchmark, but $36 million or 13.7% less than April 2022.

April 2023 Tax Collections Summary (in $ millions) - Preliminary as of May 3, 2023

Footnotes

[1]

Benchmarks are updated for the months of March 2023 through June 2023 based on the revised FY2023 revenue estimate of $39.768 billion. They are available on DOR’s website at https://www.mass.gov/lists/year-to-date-and-monthly-tax-collection-benchmark-ranges#fy-2023-.

[2]

DOR estimate of the net impact of PTE excise is based on a limited number of PTE member returns received as of April 2023. This estimate will be revised sometime after October 16, 2023 when returns for extension filers are due.

[3]

On March 3, 2023, DOR announced that preliminary year-to-date collections through February were $999 million above the year-to-date original benchmark. Through April, year-to-date state tax collections are $703 million below original FY23 year-to-date benchmark.

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