Arizona sales tax revenue declined in fiscal 2008 for the first time since 1981, according to the latest revenue report from the Joint Legislative Budget Committee.

Sales tax revenue dropped 2.3% from fiscal 2007. Revenues for the year were $4.35 billion, down $104 million from fiscal 2007 and $172 million less than expected.

General fund revenues for fiscal 2008 totaled $9.57 billion, down 6.8% from fiscal 2007. Revenues for the year were $356.4 million lower than the official estimate and $59 million less than the previous year.

State personal income tax collections dropped 9.1% from fiscal 2007, and corporate income tax collections were down 20.1%. Personal income tax collections in June were off 3.5% from June 2007, but corporate collections rose 16.8%.

The report said the state ended fiscal 2007 with a $1 million surplus from its $10 billion budget, mainly because state agencies returned $85 million in unexpended appropriations.

Arizona began fiscal 2009 with $118 million in its budget contingency fund, up from an estimate of only $20 million in May.

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