LITTLE ROCK — Arkansas tax collections were 7.7 percent above forecast in December and 9.5 percent above collections a year ago, the state fiscal office reported Wednesday.
However, much of the gain likely will be offset later by tax refunds for individuals and corporations, said Tim Leathers, deputy director of the state Department of Finance and Administration.
“It’s a good month but it’s not a spectacular month,” Leathers said. “It looks better than it is because we’re up about $8 million in individual (tax) estimates and about $13 million in corporate estimates, and a lot of the times … we get to this time of the year and taxpayers start planning their federal taxes, so they pay it into us, deduct it on their federal taxes and then turn around and get refunds.”
December collections totaled $482.3 million, $41.7 million above last year and $30.4 million above forecast, according to the revenue report.
“About $20 million or so of this that we’re ahead we may give up in refunds sometimes toward the end of the year,” Leathers said.
Independent reporting for Pine Bluff & Jefferson County since 1879.
The good news is that sales tax collections were up in December, Leathers said.
“The good spot that we see in here is finally we’re at or a little bit above gross receipts sales tax numbers,” he said.
State sales tax collections totaled $178.6 million in December, $6.8 million or 4 percent above last year and $1.3 million or .07 percent above forecast.
The increase is similar to what has been happening nationally as consumers appear to be spending more, especially during the holiday season, Leathers said.
“We’ve looked at the retail part of that and it looks like we’re pretty much in line with what we’re hearing around the country,” he said, adding that the increases are “not spectacular” but “it is good to have them up.”
In early December, state budget forecasters predicted 3.5 percent growth in revenue, about $161 million, for the fiscal year that begins July 1.
The forecast was down from the 5.3 percent growth predicted in 2010 for the 2012-2013 fiscal year.
That budget forecast was mandated in advance of the Legislature’s second-ever fiscal session that begins Feb. 13.
Gov. Mike Beebe is expected to release his balanced budget proposal for the 2012-2013 fiscal year on Jan. 16, when legislative budget hearings begin in preparation for the February fiscal session.