All three Vermont tax categories fell below targets for the month of January, according to Secretary of Administration Jeb Spaulding. Nearly all the General Fund taxes, including the vital personal income and sales taxes, were down. Fuel tax receipts were also below expectations, thus bringing down the Transportation Fund. Spaulding laid most of the blame on the lack of snow, resulting in fewer tourists and fewer consumption revenues.
January is the seventh month of fiscal year (FY) 2012. General Fund revenues totaled $129.17 million for January 2012, and were -$4.67 million or -3.49 percent below the $133.84 million consensus revenue forecast for the month. Year to date, General Fund revenues were $698.29 million, and -$4.67 million or 0.66 percent short of the target of $702.95 million for FY 2012.
Secretary Spaulding explained, ‘The January revenue results against target were disappointing, but not terribly surprising. The lack of snow is having an impact on consumption tax receipts and personal income tax withholding was less than predicted. I caution against using the results of one month to project whether the FY 2012 revenue targets are in jeopardy and do not believe January’s performance is an indicator of the underlying strength of Vermont’s economy.’
‘On a positive note, despite January 2012 General Fund revenues being below the monthly target, they do exceed the prior year results by 1.28 percent, indicative of our modest, but steady recovery,’ continued Spaulding.
Current targets reflect the Fiscal Year 2012 Consensus Revenue Forecast adopted by the Emergency Board at their January 18, 2012 meeting. Statutorily, the State is required to revise the Consensus Revenue Forecast two times per year, in January and July; the Emergency Board may schedule interim revisions if deemed necessary. A date for the July 2012 Emergency Board has not been selected at this time.
Personal Income Tax (PI) receipts are the largest single state revenue source providing approximately 50 percent of total GF revenue. PI Tax receipts are reported Net-of-Personal Income Tax refunds. Net Personal Income Tax is comprised of PI Withholding Tax, PI Estimated Payments, PI Refunds Paid, and PI Other. Net PI Receipts for January were recorded at $80.45 million, -$2.99 million or -3.58 percent below the monthly target of $83.43 million. The year to date Net PI Tax receipts were $364.34 million, or -0.81 percent below the cumulative target and 6.80 percent ahead of the prior fiscal year.
Corporate Income Taxes are also reported net of refunds. Corporate Refunds for the month were $0.86 million, ahead of the -$0.73 million monthly target by +$1.60 million. Year to date Corporate receipts were $38.85 million, +$1.60 million or +4.29 percent ahead of target, but -18.95 percent below results through January of the prior fiscal year. Secretary Spaulding commented, ‘If there is an area of concern with the revenue forecast for the remainder of FY 2012, it is with Corporate Income Tax. Indications are that larger refunds than forecast may be on the horizon, due to what we believe are over payments in Corporate Estimates. For corporations which file taxes on a calendar year, the filing deadline is March 15, 2012. We will know a good deal more by the end of March.’
Consumption tax results for January were below target for the month. Sales & Use Tax receipts of $26.97 million were short of target by -$0.94 million (-3.35 percent); Rooms & Meals Tax receipts of $11.03 million were below target by -$0.54 million (-4.65 percent). Year to date, Sales & Use Tax receipts of $140.34 million were behind target by -0.66 percent and Rooms & Meals Tax receipts of $76.44 were short of target by -0.70 percent for the current fiscal year (FY 2012). Compared to the results for the same period of the prior fiscal year (FY 2011), cumulative January consumption taxes (Sales & Use, and Meals & Rooms) exceeded the prior year results by +5.90 percent and +3.62 percent respectively.
The remaining non-major tax components include Insurance, Inheritance & Estate Tax, Real Property Transfer Tax, and ‘Other’ (which includes: Bank Franchise Tax, Telephone Tax, Liquor Tax, Beverage Tax, Fees, and Other Taxes). The results for the remaining non-major categories for January were as follows: Insurance Tax, $0.79 million (+30.78 percent); Inheritance & Estate Tax, $0.69 (-59.83 percent); Property Transfer Tax, $0.45 million (-40.55 percent); and ‘Other’, $7.94 million (-7.58 percent). The year to date January results for the remaining non-major categories were: Insurance Tax, $17.35 million (+1.08 percent); Inheritance & Estate Tax, $10.10 (-9.27 percent); Property Transfer Tax, $4.64 million (-6.20 percent); and ‘Other’, $46.22 million (-1.39 percent). Cumulatively, the year to date non-major components total of $78.3 million through January 2012, is $10.85 million or -12.17 percent below the receipts for the same period of FY 2011 (reduced for a one-time settlement received in August 2010).
Transportation Fund
Secretary Spaulding also released the non-dedicated Transportation Fund Revenue for January. Total non-dedicated Transportation Fund receipts of $16.04 million for the month fell short of target by -$0.57 million (-3.43 percent), against the monthly target of $16.61 million. The January year to date Transportation Fund receipts of $123.63 million was below the $124.20 million
target by -0.46 percent. Year to date January FY 2012 non-dedicated Transportation Funds have exceeded the prior year (FY 2011) by 1.99 percent for the same period.
Gasoline Tax, Diesel Fuel Tax and Motor Vehicle Fees all fell short of target for the month, with Motor Vehicle Purchase & Use and ‘Other’ exceeding target. Individual Transportation Fund revenue components for January were: Gasoline Tax, $4.89 million or -4.81 percent behind target; Diesel Tax, $1.29 million or -4.49 percent below target; Motor Vehicle Purchase & Use Tax, $3.85 million or +3.39 percent ahead of target; Motor Vehicle Fees, $4.56 million or -8.18 percent above; and Other Fees, $1.44 million or +1.36 percent above the monthly target. Year to date results for the individual Transportation Fund revenue components for January were: Gasoline Tax, $36.04 million or -0.68 percent short of target; Diesel Tax, $9.09 million or -0.66 percent below target; Motor Vehicle Purchase & Use Tax, $29.96 million or +0.42 percent above target; Motor Vehicle Fees, $38.23 million or -1.05 percent behind target; and Other Fees, $10.31 million or +0.19 percent above the monthly target.
The Secretary also reported on the results for the Transportation Infrastructure Bond Fund (’TIB’). TIB Fund Gas receipts for January were $1.76 million or +5.33 percent in excess of target; year to date TIB Gas receipts were $12.73 million or +0.71 percent ahead of target. TIB Fund Diesel receipts for the month were $0.15 million or -20.25 percent below the monthly target; year to date TIB Diesel receipts were $1.09 million or -3.45 percent short of target. The TIB Fund receipts are noted below the following table:
Education Fund
Today, Secretary Spaulding released the ‘non-Property Tax’ Education Fund revenues (which constitute approximately 12 percent of the total Education Fund sources). The non-Property Tax Education Fund receipts for January totaled $17.55 million, or -$0.27 million (-1.53 percent) below the $17.82 million target for the month. Year to date, non-Property Tax Education Fund receipts were $96.71 million, or -0.28 percent short of the year to date target. The individual Education Fund revenue component results for January were: Sales & Use Tax, $13.48 million, or -3.35 percent below target; Motor Vehicle Purchase & Use Tax, $1.93 million or +3.39 percent; Lottery Transfer, $2.14 million or +8.02 percent; Education Fund Interest for January was immaterial for the month. Year to date receipts by component were: Sales & Use Tax, $70.17 million, or -0.66 percent short of target; Motor Vehicle Purchase & Use Tax, $14.98 million or +0.42 percent; Lottery Transfer, $11.54 million or +1.40 percent ahead of target; year to date Education Fund Interest for January was $0.02 million against a target of below $0.05 million. Although the non-property tax Education Fund receiptsare below the current year target, they are 6.49 percent ahead of the FY 2011 results for the same period.
Conclusion
Secretary Spaulding concluded, ‘Although the results for all three major funds (General, Transportation and Education Funds) were below the recently revised Consensus Revenue Forecast targets for the month, we see no reason to ring alarm bells at this time. We will carefully watch as results of the spring tax filing season come in and the rest of the winter recreational season plays out to get a clearer picture of where revenue results for the year are headed.’
Attachments
The detailed schedules of the January 2012 year to date revenue results comparing the current periods with last year follow.
Note: Minor differences in figures are due to rounding.
Secretary of Administration 2.15.2012