Virginia Posts 20.5% Revenue Increase in May
– May a Significant Month for Revenue –
Governor Bob McDonnell announced that May revenue collections increased by 20.5 percent from May of last year. May is a significant month for revenue collections. On a year-to-date basis, total revenue collections rose 6.0 percent through May, ahead of the annual forecast of 3.6 percent growth. Adjusting for the accelerated tax program, total revenues have grown 5.7 percent, ahead of the adjusted forecast of 3.4 percent. To meet the state’s budget forecast, collection of $1.7 billion will be needed in the month of June. Last year, the Commonwealth collected $1.9 billion in the final month of the fiscal year.
The increase in May revenue was driven by a major increase in individual nonwithholding payments. These payments increased by 74.7 percent for the month, rising to $776.1 million, compared to $444.2 million last May. May is a very important month for individual nonwithholding payments as final payments for tax year 2012 and the first estimated payment for tax year 2013 are both due May 1. April is also an important month for individual nonwithholding as a number of final payments arrive during that period. Taken together, nonwithholding collections for April and May, the best way to look at the payments in totality, were up 30.7 percent over the same period last year.
In other areas, sales and use tax collections grew 2.7 percent for the month. Individual income tax withholding fell 1.8 percent.
Speaking about the May numbers, Governor Bob McDonnell noted, “Revenue is up; unemployment is down. This is more good news for Virginia’s economy. Over the past three years we’ve seen our state unemployment rate fall to 5.2 percent; the lowest mark in Virginia in 4 ½ years. During that time over 171,000 net new jobs have been created in the Commonwealth during that period; 151,000 of those jobs are in the private-sector. Put simply: more Virginians are working, and that increase in employment is reflected in the growth in state revenue collections. We still have another month to go before the fiscal year draws to a close, and therefore caution is in order before projecting too far out about how the Commonwealth’s books will look at the end of the year. However, at this moment, it does appear Virginia is on track to meet, and exceed, budget projections, and to post a fourth-straight revenue surplus. We are budgeting conservatively, setting priorities in state spending, and investing wisely in the core functions of state government, like transportation and education, that are crucial to helping the private-sector create good paying jobs for our citizens. Virginia’s economy is growing, and more Virginians are finding good jobs. That’s a testament to the bipartisan effort in Richmond to come together and find solutions to make life better for all Virginians.”
The May revenue numbers are available at this link: http://www.finance.virginia.gov/KeyDocuments/RevenueReports/FY2011-2012/2012ReportsList.cfm