Georgia tax revenue collections dipped in November
Georgia Gov. Nathan Deal said tax revenue collections slipped 0.7% in November from a year earlier after increasing in nine of the first 10 months of 2018.
For the fiscal year-to-date, "net tax revenue collections totaled almost $9.66 billion, for an increase of $619.4 million or 6.9%, compared to November 2017,” Deal said.
For the same five month period in 2017, tax revenues totaled $9.04 billion, an increase of 2.7% over 2016.
Drivers of the dip in November included a 53.4% drop in property tax revenues, a 24.4% decrease in individual income tax return payments, a drop in the local distribution of sales and use taxes by 17.9%, and a decrease in tobacco tax collections by 6.4%.
Individual income tax collections for November totaled $932 million, a decrease of $22.6 million or 2.4%, while corporate income tax revenues totaled $27.2 million, an increase of 11.9%.
Gross sales and use tax collections for the month totaled $1.01 billion, for an increase of $100.2 million, or 11%.
The Georgia Department of Revenue didn’t respond to a request for comment about November’s results.
In October, revenue collections were up 17.7%.
Georgia has seen an upward tick in revenue collections in all but two out of 11 months this calendar year. While the state has seen growth in revenues for several years, the growth rate is narrowing.
From January through November this year, the average monthly revenue growth rate was 5.5%.
In 2017, the average growth rate during the same period was 4.2% and in 2016 it was 5.98%, and all 12 months saw positive revenue collections.
Moody's Investors Service analysts predict state-level revenues will continue to grow 3.5% to 4.5% in 2019, but with expectations of continued - but slower - economic growth and without the initial benefit due to the enactment of the December 2017 federal Tax Cuts and Jobs Act.
“The rate of growth in total state revenues has varied considerably from year to year, due to the enactment by states of both tax increases and tax cuts, the impact of stock market volatility on personal income taxes, and decisions by individual taxpayers to accelerate or delay the recognition of gains and losses in anticipation of changes in federal tax law,” the analysts said in a Dec. 6 Outlook report.
Earlier this year, Georgia’s Republican-led Legislature cut the top marginal income tax rate to 5.75% from 6%, and doubled the standard deduction for all taxpayers.
Deal, a Republican who is term-limited out of office this year, said the cuts will save Georgia taxpayers $5.5 billion over the next five years.
“These combined changes mark one of the biggest income tax cuts in state history, and does so in a fiscally responsible manner,” he said in February.