Arkansas Ends Fiscal Year With Surplus

DALLAS – Arkansas ended fiscal 2013 with a $300 million surplus, Gov. Mike Beebe said Tuesday, but much of the surplus may be from taxpayers who paid in 2012 to avoid a higher federal income tax bill.

The state collected $5.027 billion in fiscal 2013, the Department of Finance and Administration said in its monthly revenue report. The total is $299.5 million more than budgeted for the year.

“This is good news but it’s not nearly as good news as the raw numbers would suggest,” Beebe said Tuesday at a news conference in Little Rock.

Beebe said the General Assembly can decide whether to use the surplus to cut taxes or spend it, or put it into the rainy day fund. A budget session will begin in February 2014.

Lawmakers approved a package of tax cuts this year that will cut state revenues by $140 million a year. The state ended fiscal 2012 with a $146 million surplus.

But first, Beebe said, officials must determine if the surplus is a real indicator of economic vitality or a unique event.

“I'm happy, but there's an anomaly in there that will have to be corrected next year,” he said.

“We’ll have to wait and see, but we’ll be back in February with a budget session.”

Individual income tax collections totaled $3.14 billion in the year that June 30, an increase of $249 million from fiscal 2012 and $191 million more than expected.

The take from individual taxpayers was almost $200 million above the official forecast.

Sales tax collections in 2013 of $2.12 billion were $30 million less than expected but $22.5 million more than in 2012.

The failure of the sales tax to meet predictions for 2013 is a concern, Beebe said. Monthly collections from the sales and use tax in 2013 fell below 2012 totals in 11 of the 12 months.

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