The Office of State Budget Director reported February’s General Fund receipts declined 0.6 percent compared to February of last year.
Collections for the month were $970.8 million while General Fund revenues for February 2025 were $977.1 million. Receipts have fallen 1.1 percent through the first eight months of FY26. The official CFG estimate calls for a 1.3 percent decline in revenues for the current fiscal year. To meet the official revenue estimate, receipts can decline 1.7 percent over the last four months of the fiscal year and still meet the estimate.
“The withholding component of the individual income tax plus the sales tax combined to generate $864.2 million of the $970.8 million in General Fund revenue, or 89 percent of the February total,” said State Budget Director John Hicks. “The withholding component fell by only 2.6 percent despite the 12.5 percent reduction in the income tax rate effective last month. That is due in part to the filing schedule for some businesses that results in a February deposit of some of their withholding taxes from December at the higher 4 percent tax rate.
“Income tax refund amounts and the number of returns requesting refunds in February were higher than last year. The sales tax continues to be stable, rising 3.3 percent in February and up 4.8 percent for the year.”
Among the major accounts:
• Sales and use tax receipts rose 3.3 percent to $376.3 million. Year-to-date growth in this account now stands at 4.8 percent.
• Combined corporation income and LLET tax receipts were $39.5 million greater than what was collected last February. Corporation income tax collections accounted for almost all of the monthly increase. For the year, combined revenues dropped by 44.1 percent.
• Individual income tax collections experienced the largest percentage decrease this fiscal year, falling 9.8 percent or $43.3 million. Withholding fell modestly and net returns dropped $29.8 million. Income tax collections have grown 4.8 percent through the first eight months of the year.
• Property tax collections fell 4.7 percent for the month to $36.7 million. For the year, revenues have increased 2.8 percent.
• Cigarette tax receipts fell 41.3 percent for the month, ending an unlikely pattern of four consecutive monthly increases. Year-to-date revenues have decreased 5.3 percent.
• Coal severance tax receipts totaled $3.5 million in February and have increased 1.7 percent through the first eight months of the fiscal year.
• Income on investments dropped $6.8 million, or 27.6 percent. Through the first eight months of FY26, income on investments has dipped 21.5 percent.
Road Fund receipts fell 11.3 percent in February as collections totaled $131.5 million, the lowest monthly total in FY26. Total revenue has fallen 1.3 percent through the first eight months of FY26.
Motor fuels collections fell 12.1 percent and motor vehicle usage tax receipts declined 7.5 percent.The official Road Fund revenue estimate call for revenues to decrease 1.0 percent for the fiscal year.
Based on year-to-date tax collections, revenues can decline 0.6 percent for the remainder of the year and still meet the official estimate of $1,844.0 million.
Office of the State Budget Director