Annual state revenues drop but keep progressive pace

January revenue collections increased 4.3 percent to $630.5 million, dropping year-to-date growth to 5.7 percent. In December, the state reported 6 percent annual growth.

Still, strong income tax collections continue to encourage state officials.

Corporate income and franchise tax collections increased 41.3 percent for the year, to $319.6 million, and 20.4 percent for the month. Individual income tax collections, another indicator of economic growth, grew 8.4 percent for the year, to $2.7 billion, and 8.3 percent for the month.

While optimism is high on consumer spending, the Office of Administration said high energy prices could pressure sales and other tax collections. Sales and use tax collections were up 3.7 percent in January but only 1.8 percent year-to-date. Employment is expected to remain steady - the state added 38,300 jobs in 2005 - despite energy pricing.

As tax season rolls in, a high number of electronic filers helped grow January refunds by 27.3 percent. For the year, refunds are up 37.3 percent to $356.5 million.

The state's “all other collections” category took a 17.6 percent hit in January, creating a 2.8 percent deficit compared to last fiscal year.[[In-content Ad]]