The Office of State Budget Director on Monday reported January’s General Fund receipts totaled $1,344.8 million.
The revenues were 4.4 percent more than what was received in January of last year, an increase of $56.8 million. January’s sales tax receipts hit a record high at $586.2 million. Large increases also occurred due to the new portion of the individual income tax, known as the pass-through entity tax (PTE), payroll withholding receipts, and interest income. The new PTE tax which create a dollar-for-dollar refundable credit on upcoming individual income tax returns.
The official FY24 General Fund revenue forecast, which was revised by the Consensus Forecasting Group on December 8, 2023, calls for 2.7 percent revenue growth. Revenues must increase 0.7 percent over the initial six months of the fiscal year to meet the estimate.
State Budget Director John Hicks said: “General Fund collections produced broad-based growth in January. Year-to-date collections are on pace to achieve the new official estimate for FY24 and are significantly above the projected revenues for the enacted FY24 budget. Both withholding and sales tax receipts were quite strong in January, sending a clear signal that Kentuckians are experiencing wage gains which support a brisk pace of consumer spending.”
Among the major accounts:
• Individual income tax collections grew 4.1 percent for the month. Withholding receipts rose 5.5 percent while PTE revenue was $66.6 million. The remaining individual income accounts combined to fall by nearly $65 million compared to last January. Revenues have grown 2.9 percent through the first seven months of FY24.
• Sales and use tax receipts continue to be strong. Collections were an all-time monthly high of $586.2 million, 6.0 percent more than was collected last January. Revenues have grown 5.7 percent year-to date.
• Combined corporation income and LLET tax receipts totaled $26.6 million in January, a decrease of 46.7 percent. Year-to-date collections have fallen 7.8 percent.
• Property tax collections grew 3.7 percent in January to $106.3 million. Collections through the first seven months now stand at a 1.5 percent growth rate.
• Cigarette tax receipts fell 10.7 percent for the month. Year-to-date revenues have fallen 10.2 percent.
• Coal severance tax receipts had their first growth month since August, increasing 1.4 percent to $10.0 million. Collections have declined 22.7 percent through the first seven months of the fiscal year.
• Income on investments totaled $27.2 million in January, an all-time high for monthly receipts in that account.
Road Fund receipts fell 5.7 percent in January with total collections of $135.8 million. Motor fuels revenues grew at a higher-than-expected rate while motor vehicle usage taxes declined sharply. Year-to-date collections have increased 6.7 percent.
The official Road Fund revenue estimate calls for revenues to grow 7.3 percent for the fiscal year. Based on year-to-date tax collections, revenues must increase 8.2 percent for the remainder of the fiscal year to meet the official forecast.
Among the accounts, motor fuels collections rose 18.9 percent, motor vehicle usage revenue fell by 26.7 percent, and license and privilege receipts dropped 19.3 percent.
The motor vehicle usage and motor vehicle license accounts incurred some timing irregularities due to the closure of vehicle registration and licensing operations in the first part of January 2024 due to the migration of the 45-year-old vehicle information system to a new system.
Office of State Budget Director
