General revenue collections in October of $457.5 million were $23.4 million more than in October 2010, but Arkansas’ chief financial officer said the state’s economy is recovering slowly.
Richard Weiss, director of the Department of Finance and Administration, said while Arkansans are earning more, they are spending less.
“A lot of people built up a whole lot of debt, and they are either saving money or paying down debt,” he said.
The personal income tax provided $228.8 million in October, up almost 11% from last year. John Shelnutt, the department’s chief economic forecaster, said individual withholdings were up due to an extra payroll period during the month. Sales tax collections dipped slightly to $174.5 million, down $800,000 from October 2010.
Richard Wilson, assistant director of the Bureau of Legislative Research, said he expects slow revenue growth over the remainder of the fiscal year, “assuming no more unexpected shocks.”
The revenue forecasts for fiscal 2012 have been right on target, Gov. Mike Beebe said. He is scheduled in early December to deliver a budget and revenue forecast for fiscal 2013 to lawmakers, and his staff is still working on the budget proposal.
“All the things about the projections for the economy get factored in when we do a forecast,” Beebe said. “If there are any pressures that suggest downward revenues, we’ll take that into consideration and we’ll err on that side.”
Net collections in the first four months of fiscal 2012 total $1.58 billion. The four-month total is $9.9 million more than predicted and $42 million more than in the same period of fiscal 2011.
The fiscal 2012 total so far includes $720 million of sales tax collections and $853 million from the individual income tax.
Fiscal 2011 revenues were $91.4 million more than expected and $243 million more than in fiscal 2010.