The State Budget Director’s office has announced that Kentucky’s General Fund receipts fell 1.7 percent in August compared to last year. Total revenues for the month were $1,088.6 million, compared to $1,107.7 million last August.
So far this fiscal year, General Fund receipts have increased 13.8 percent. The official revenue estimate for FY27 calls for General Fund revenues to fall 0.5 percent compared to FY26 actual receipts. Based on Augusts’ results, receipts can fall 2.8 percent for the remainder of the fiscal year and still meet the official estimate.
“August is usually one of the lowest months of each fiscal year for General Fund revenues receipts,” said State Budget Director John Hicks. “Through the first two months of FY27, sales and use taxes have risen 6.5 percent and major business taxes are more than $300 million higher than last year. Individual income tax collections declined by 10.1 percent due mainly to the 12.5 percent rate reduction effective January 1, 2026, from 4.0 percent to 3.5 percent.
“The Consensus Forecasting Group will meet later this month to revisit the FY27 and FY28 General Fund revenue estimates in light of the FY26 revenue surplus and the 13.8 percent growth thus far in FY27.”
Among the major accounts:
• Individual income tax collections fell 8.1 percent largely due to a 10.1 percent decline in withholding receipts. The remaining components of the tax all had modest increases.
• Sales tax revenues grew 3.4 percent in August and are up 6.5 percent through the first two months of the fiscal year.
• Major business tax collections were $16.2 million for the month, a decrease of 8.2 percent compared to prior year totals. Year-to-date receipts in these accounts have increased dramatically due to the large increase in estimated payments in July.
• Cigarette taxes fell 15.4 percent for the month but have increased 1.0 percent for the year.
• Property taxes rose 13.9 percent in August and have increased 17.2 percent for the fiscal year. Large swings in property tax receipts are not unusual early since less than 5.0 percent of annual revenues have been collected.
• Coal severance tax collections in August grew 33.5 percent to $5.6 million and are up 17.8 percent through the first two months of the fiscal year.
• Lottery revenues were unchanged at $27.5 million in August and are flat through the first two months of FY27.
• Income on investments fell. Through the first two months of FY27, income on investments has declined 29.1 percent due primarily to a reduction in investable balances.
Road Fund receipts for August totaled $160.0 million, an increase of 1.3 percent from August 2025 levels. Through the first two months of the fiscal year, collections in this fund have fallen 7.0 percent. The official Road Fund revenue estimate calls for a 0.8 percent increase in receipts for FY27. Based on year-to-date collections, revenues must grow 2.5 percent for the remainder of the fiscal year to meet the estimate.
Among the major accounts:
• Motor fuels declined 1.1 percent in August with revenues of $67.4 million and have declined 11.5 percent for the year.
• Motor vehicle usage collections rose 5.3 percent for the month but have fallen 3.1 percent for the first two months of the fiscal year.
• License and privilege tax receipts fell 0.9 percent in August and have dropped 1.9 percent year-to-date.
To access the report, visit osbd.ky.gov.
Office of Kentucky State Budget Director