California revenues beat forecasts again in June, continuing a trend that has resulted in the state posting an $8.5 billion surplus.
The recently passed budget set aside more than half of the surplus into reserves.
“At this point, we would caution that is not be construed as an add-on to the surplus amount,” said H.D. Palmer, a spokesman for the state’s Department of Finance. “As we always caution, one month’s worth of cash data, good or bad, shouldn’t be used to extrapolate a longer-term revenue trend. Too many variables can swing any given month’s revenue data in either direction.”
June revenues came in $1.6 billion above the month’s forecast of $17.7 billion in the 2018-19 Budget Act; and for the fiscal year to date, they ended up $1.54 billion above the May Revision forecast of $134.5 billion, according to the Department of Finance report released Monday.
All three of the state’s largest tax sources were above expectations for the month – personal income tax, sales and use tax, and corporation tax.
Personal income tax cash receipts to the General Fund were $790 million above the month’s forecast of $11.9 billion. Withholding receipts were $8 million above the forecast of $4.8 billion. Fiscal year 2017-18 General Fund personal income tax cash receipts were $1.2 billion above forecast.
Sales and use tax receipts were $12 million above the month’s forecast of $2.564 billion. Fiscal year 2017-18 sales tax cash receipts were $380 million below forecast.
Corporation tax revenues were $606 million above the month’s forecast of $2.632 billion. Estimated payments were $842 million above the forecast of $2.263 billion, and other payments were $236 million lower than the $441 million forecast. Total refunds for the month were equal to the forecast of $72 million. Fiscal year 2017-18 corporate income tax cash receipts were $531 million above forecast.
Insurance tax cash receipts were $92 million above the $57 million estimated for June and were $61 million above forecast for fiscal year 2017-18. Cash receipts from pooled money interest and alcoholic beverage and tobacco taxes came in $4 million above the month’s forecast of $64 million and were up $19 million for fiscal year 2017-18.
Refunds issued in June were $59 million below the forecast of $455 million.
The state collected $14 million more than the $199 million forecast for collections for the Mental Health Services Fund. Proposition 63 requires that 1.76% of total monthly personal income tax collections be transferred to the fund.