The Indiana Statehouse on Thursday, May 25, 2023. (Leslie Bonilla Muñiz/Indiana Capital Chronicle)
Indiana coffers took in about $1.37 billion worth of taxes in November, but remained below expectations for a second straight month this fiscal year, which began in July.
The revenue forecast predicted revenues of about $1.41 billion but collections were short $45.8 million, about 3.2% under projections. There’s $115 million less than expected year-to-date, according to a monthly revenue report.
That’s a smaller gap than in October, when the fund took in about 8% less than projected.
State revenue under projections for first time this fiscal year
The state was primarily behind on its sales and corporate income tax collections.
An accompanying commentary from the State Budget Agency noted that estimates for use tax revenue are off because the latest budget bill directs gasoline use tax revenues away from the General Fund and toward road and bridge funding. That was about $6 million in November.
But sales tax revenues were still down nearly $41 million compared to the monthly estimate. The commentary said November’s -0.5% year-over-year growth “mostly reflects October economic activity.”
The state still expects those collections to grow about 4% year-over-year, but it’s a lower rate than in recent years.
And the General Fund lost out on corporate tax collections, down about $21 million less than expected, or about $148% under.
“Differences relative to monthly estimates are likely as various factors may impact monthly revenue activity including payment and refund timing, late payments, and more,” the commentary noted. December’s total will be more important, according to the commentary, because it includes an important quarterly payment due date.
The state made more money off interest than expected and stayed near its targets on other revenue sources, but were still “outweighed” by lower-than-expected collections from sales tax and corporate income tax.
The monthly collections fund Indiana’s biannual budget.
Outgoing Gov. Eric Holcomb, a Republican, signed his final budget bill — worth $44 billion — in May.
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