Arkansas revenue report for March, 2008

This is the ninth monthly report of the fiscal year, and revenues continue to come in above forecast. Collections for the fiscal year are $145 million above forecast, due primarily to gains in income tax collections.

Collections of net available general revenues for March were $343.1 million. That is 7.6% above March, 2007 and 6.9% above forecast. Gross receipts collections for March, which include sales/use taxes, totaled $178.1 million (about 1.3% below March, 2007 but 1.7% above forecast). We are only collecting one half of the sales tax on food and food ingredients now, whereas last February we were collecting the full 6 cents. Gross receipts are a key indicator of consumer spending, which comprises roughly two-thirds of economic activity.

Individual income tax collections are 7.6% above projections (and 13.2% above March, 2007) and corporate income tax collections are 11.2% below forecast and 20.5% below March, 2007. Collections of individual income tax returns came in at $203.9 million, and corporate income tax collections were $49 million.

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