Vermont Business Magazine Another positive performance by the Personal Income Tax has pushed annual revenues ahead of projections for the year. Secretary of Administration Trey Martin released Vermont’s “preliminary” revenue results today for October. Preliminary data reflects a good month for the General Fund but a down month for Transportation and Education Funds. October is the fourth month of Fiscal Year 2017. The Sales & Use tax, the second most important revenue source, struggled again, as did the Corporate tax. Both are lagging behind targets and noticeably behind year-to-year totals. The Corporate tax has been strong the last couple of years and has to some extent offset a weakness in the Personal Income Tax. The third largest tax is Rooms & Meals, which has stayed relatively strong both month to month and year to year.
The General Fund for the month of October collected $120.34 million, $1.36 million above the consensus revenue target adopted by the Emergency Board on July 21, 2016. This slightly higher than expected performance in October was driven by ups in the Personal Income and Meals and Rooms taxes of $1.55 million and $1.05 million respectively. These ups were partially offset by underperformance in the Sales and Use Tax of -$0.43 million, Inheritance and Estate Tax of -$1.80 million and the Property Transfer Tax of - $0.13 million. Through the first four months of the fiscal year the General Fund is slightly ahead of target on the consensus revenue projection from July. Year to date receipts in General Fund are $469.88 million, versus a target of $468.56 million.
Agency of Administration Secretary Trey Martin said, “These numbers reflect continued strong management of Vermont’s fiscal health by the Shumlin Administration. Over the last six years, revenues have grown at a steady 3 percent rate, Vermont businesses have brought 19,000 new jobs online, and total budget growth has been held to 3.7 percent overall. This team has delivered balanced budgets year after year without increasing income tax, sales tax, or rooms and meals tax rates.”
Revenue targets have been downgraded over the last few years as the recovery from the Great Recession has not been as robust as expected.
The Transportation Fund collected $22.65 million for the month of October, -$1.02 million below a target of $23.68 million. This underperformance was driven primarily by a down in the Motor Vehicle Fees of -$0.56 million and the Purchase and Use Tax of
-$0.29 million. Year to date, receipts in the Transportation Fund are down -$2.88 million against target.
The Education Fund collected $17.00 million for the month of October, missing its target by -$0.43 million. All major revenue streams experienced a slight underperformance.
Overall, revenues have increased year over year in the General Fund by +$13.82 million or 3.03%, the Transportation Fund +$0.12 million or 0.13%, and the Education Fund +$0.06 million or 0.09%.
Secretary Martin added, “We are pleased to see the General Fund slightly ahead of target year to date, although we will be watching the individual components closely as trends begin emerging over the next few months.”
