November 3, 2015
Topeka Kansas collected $11 million less in taxes than anticipated in October, making it more likely that the state will have a projected deficit in its current budget.
The Department of Revenue said Monday that the state collected $446 million in taxes last month when its official forecast anticipated $457 million. The shortfall for the month was 2.4 percent, and softer-than-expected sales, corporate income and oil and natural gas production taxes were largely to blame.
Since the current fiscal year began in July, tax collections have fallen about 4.1 percent short of expectations, at $1.8 billion. The $78 million shortfall in tax collections over the past four months would — unless trends change — wipe out any cushion of cash reserves that Republican Gov. Sam Brownback and the GOP-dominated Legislature expected the state to have at the end of June 2016.
The report on October tax collections came only days before university economists, legislative researchers and officials in Brownback's administration were to meet to issue new projections for tax collections through June 2017. The new fiscal forecast due Friday is expected to be more pessimistic — and project a budget deficit.
Kansas has seen taxes from oil and gas revenues plummet with low energy prices, and officials have blamed a sluggish national economy for disappointing sales tax collections.
"This really is kind of following a national trend, particularly the sales tax," said Department of Revenue spokeswoman Jeannine Koranda.
The state has struggled to balance its budget since Republican legislators slashed personal income taxes in 2012 and 2013 at Brownback's urging, in an effort to stimulate the economy. The governor and his allies raised cigarette taxes and boosted the sales tax rate in July to avert a deficit in the state's current, $15.3 billion budget.
House Minority Leader Tom Burroughs, a Kansas City, Democrat, said disappointing sales tax collections show "just how much Kansas families are struggling" under Brownback's policies.
Over the past four months, sales tax collections, at $906 million, have fallen $41 million short of expectations, or 4.4 percent. Oil and gas production tax collections, at about $3.2 million, are less than a quarter of the projected $13.5 million since July. Corporate income tax collections, at $112 million, have been nearly $26 million, or 18.6 percent, less than expected.
But individual income taxes were a bright spot in October. At $173 million for the month, they exceeded expectations by $13 million, or 8.2 million — and all but erased a shortfall between actual and anticipated collections that had developed the previous three months.
The Department of Revenue was quick to highlight the unanticipated bulge in income tax collections, but Koranda acknowledged, "We'd have to wait and see whether that's a trend."
Originally published at: http://www.bonnersprings.com/news/2015/nov/03/kansas-tax-collections-11m-short-expectations-octo/