NASHVILLE, Tenn. – Tennessee Department of Finance and Administration Commissioner Butch Eley today announced that Tennessee tax revenues exceeded budgeted estimates in October. Overall October revenues were $1.2 billion, which is $38.2 million more than October of last year and $134.8 million more than the budgeted estimate. The growth rate for October was 3.39%.
“Tennessee’s economy continues to recover as October’s monthly revenue growth exceeds expectations,” Eley said. “We are pleased to see growth over three percent from the same month last year. Sales tax revenues were $110.6 million more than the estimate for October and the October growth rate was 5.81% with year-to-date growth rate of 3.73%.
“Even though we are presently exceeding expectations, we will continue to proceed cautiously and closely monitor our revenue and expenditure patterns for the remainder of the fiscal year.”
On an accrual basis, October is the third month in the 2020-2021 fiscal year.
General fund revenues for October were $125.2 million more than the budgeted estimate, and the four other funds that share in state tax revenues were $9.6 million more than the budgeted estimates.
Franchise and excise combined revenues for October were $55.2 million, which is $11.7 million more than the budgeted estimate of $43.5 million. Due to the high volatility of these taxes the growth rate for October was 26.19% and the year-to-date growth rate is 3.48%.
Gasoline and motor fuel revenues decreased by 17.22% for October but were $1.3 million more than the budgeted estimate of $106.5 million. Adjusting for a large $23.3 million one-time motor fuel tax payment made last year at this time, gasoline and motor fuel revenue growth was a positive 0.84%for the month.
Motor vehicle registration revenue receipts increased by 6.57% and were $2.7 million more than the October estimate.
Tobacco tax revenues for the month were $0.2 million less than the budgeted estimate of $18.9 million. The growth rate for October was negative 2.36%.
Privilege tax revenues were $8 million more than the budgeted estimate of $35.2 million and the year-to-date growth rate is 13.90%.
Business tax revenues increased by 15.18% and were $2 million more than the budgeted estimate.
Income tax receipts were $3 million more than the October estimate and mostly flat compared to the same month last year.
Mixed drink, or liquor-by-the-drink, taxes were $3 million less than the October estimate, and on a year-to-date basis, revenues are 42.06% lower than last year.
All other tax revenues were less than estimates by a net of $1.3 million.
Year-to-date revenues for three months are $447.4 million more than the budgeted estimate. The general fund has exceeded estimates by $433.2 million and the four other funds that share in state tax revenues exceeded estimates by $14.2 million.
The budgeted revenue estimates for 2020-2021 are based on the State Funding Board’s consensus recommendation of November 26, 2019 and adopted by the second session of the 111th General Assembly in June 2020. Also incorporated in the estimates are any changes in revenue enacted during the 2020 session of the General Assembly. These estimates are available on the state’s website at https://www.tn.gov/content/tn/finance/fa/fa-budget-information/fa-budget-rev.html.