Arkansas revenues of $377 million in July were $2.4 million below expectations but $6.4 million more than collected in July 2010.
Sales tax revenues of $181.2 million in July were $7 million less than July 2010 and $13.1 million below the official forecast.
Legislative reduction in the sales tax on groceries and manufacturers’ utility bills went into effect July 1, but those measures had been considered in the official revenue forecast.
The Department of Finance and Administration said the $193.6 million of individual income tax collections in the first month of fiscal 2012 was $2.7 million more than expected and $12.4 million more than in July 2010.
Gov. Mike Beebe said the drop in sales tax collections could be a troubling economic indicator.
“A lot of people are of the opinion that people just aren’t spending money because of the uncertainty of the economy and what’s going to happen tomorrow,” Beebe said at a news conference on Friday.
“If the income tax is holding up, that means there are some people that are actually getting income and paying more into their withholding, so that lends some credence to the argument that people may just be holding on to the money because of the uncertainty,” he said.
Arkansas ended fiscal 2011 with a $94 million surplus.