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The state Department of Finance and Administration said Wednesday that November net available general revenue was $464 million, $32.2 million above November 2019 and $51.5 million — or 12.5% — above forecast.
Year-to-date, available general revenue was $2.69 billion, 11.4% above the same time last year and 11.8% above forecast. The department said the results include net collection increases tied to the income tax due date shift from July to April in the previous fiscal year.
Arkansas’ current fiscal year began July 1.
More: See the complete report.
All but one collection category was above forecast last month; corporate income tax collections were below forecast “in a traditionally low collection month,” the department said.
November sales tax collections came in at 2.6% above the same month last year and 3% above forecast.
The report said individual income tax collections for the month were $22.8 million above forecast, and corporate income tax collections were $1.8 million below projections.
The November report continues to show Arkansas collections ahead of forecast. The forecast had been revised on March 23 because of the COVID-19 pandemic; it was revised again, on June 30, up by $240 million.
The department previously reported that total collections were 18% ahead of forecast for October, 12% ahead in September, 9.2% ahead in August and 8.6% ahead in July.
Tax Cuts on the Agenda
The report comes ahead of the next legislative session that begins Jan. 11. Gov. Asa Hutchinson has outlined a budget that includes $50 million in new tax cuts.
Hutchinson’s proposal calls for reducing sales taxes on vehicles priced less than $10,000 from 6.5% to 3.5%, and cutting income taxes for new residents to 4.9% for five years. Hutchinson said the latter will help the state’s economic development efforts by creating an incentive to move to the state, as well as help move Arkansas toward his goal of cutting the top tax rate to 4.9%.
The plan also includes $25 million in unspecified tax cuts for low- and middle-income residents that his office said will be developed with the Legislature.
The budget plan calls for tapping into $217 million of the state’s nearly $241 million in surplus funds, with $25 million going toward Hutchinson’s proposed tax cuts. It also proposes sending $100 million from the surplus to a long-term reserve fund, $28.5 million for school facilities and $30 million for rural broadband.
The proposed budget increases spending 2.8%, with the largest increases going toward public schools, human services, and colleges and universities.
(The Associated Press contributed to this report.)