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RICHMOND – Governor Northam announced today that January General Fund revenues rose 5.1 percent from the previous January – largely due to payroll withholding.
Speaking about the revenue increase Governor Northam said, “This positive revenue growth indicates that Virginia’s economy is strong but we must continue to build and diversify an economy that works for all Virginians. Although we are ahead of the forecast, about 42 percent of the total general fund estimate remains to be collected. This session and going forward, we have the opportunity to build on this growth by creating jobs and strengthening the underpinnings of our economy.”
January is a significant month for revenue collections. Besides the normal monthly payroll withholding and sales tax collections, estimated payments from individuals are due in January. Much of the growth was due to an additional deposit day in payroll withholding this January as compared to a year-ago. On a fiscal year-to-date basis, total revenue collections rose 5.8 percent through January, ahead of the annual forecast of 3.4 percent growth.
Collections of payroll withholding taxes grew 14.0 percent for the month, with one more deposit day than January of last year. Collections of sales and use taxes, reflecting December sales, rose 0.8 percent in January. The combined December and January receipts, representing the bulk of the holiday shopping season, was 0.4 percent above the same period last year. Also, December and January are significant months for collections of nonwithholding and receipts can be distorted by the timing of payments. Taxpayers had until January 16 to submit their fourth estimated payment for tax year 2017 and some of these payments are received in December. Receipts of nonwithholding for the two-month period rose 40.3 percent from last year.
Year-to-date, withholding collections are 4.7 percent ahead of the same period last year, above the annual estimate of 3.5 percent growth. On a year-to-date basis, sales tax collections have risen 3.2 percent, slightly ahead of the annual estimate of 3.0 percent growth. Nonwithholding collections for the first seven months of the fiscal year rose by 20.2 percent, ahead of the annual estimate of a 4.3 percent increase. On a fiscal year-to-date basis, total revenue collections rose 5.8 percent through January, above the annual forecast of 3.4 percent growth.
To view the full report click here.
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