NASHVILLE – Tennessee revenues exceeded budgeted estimates for the month of April. Finance and Administration Commissioner Butch Eley today reported that April total tax revenues were $3 billion, which is $525.9 million more than April of last year and $915.3 million more than the budgeted estimate. The total growth rate for the month was 21.27 percent.
“April tax revenues outperformed budget estimates for the month and continue to reveal a dynamic state economy,” Eley said. “Much of the month’s tax growth can be attributed to franchise and excise tax payments and filings that reflect record high levels of profit and valuation from corporations during the past year. In addition, sales tax receipts, business tax revenues, privilege taxes and gas tax proceeds also greatly contributed to the state exceeding estimates for the month.
“While August through April revenues have now exceeded our revised budget estimates, we will continue to monitor revenue and expenditure patterns for the remainder of this fiscal year to financially position ourselves for the future.”
On an accrual basis, April is the ninth month in the 2021-2022 fiscal year.
General fund revenues were $881.3 million more than the budgeted estimate while the four other funds that share in state tax revenues were $34 million more than the estimates.
Sales tax revenues were $263.3 million more than the estimate for April and 9.15 percent more than April 2021. For nine months, revenues are $1.7 billion higher than estimated. The year-to-date growth rate for seven months was 16.73 percent.
Franchise and excise tax revenues combined were $584.2 million more than the budgeted estimate in April and the growth rate compared to April 2021 was 39.27 percent. For nine months, revenues are $1.4 billion more than the estimate and the year-to-date growth rate is 35.85 percent.
Gasoline and motor fuel revenues for April increased by 14.73 percent compared to April 2021 and were $12.8 million more than the April budgeted estimate of $104.5 million. For nine months, revenues are more than estimates by $46.2 million.
Motor vehicle registration revenues were $2.4 million more than the April estimate, and on a year-to-date basis they are $14.9 million more than estimates.
Tobacco taxes were $1.3 million more than the April budgeted estimate of $18.1 million. For nine months, they are $1.5 million less than the budgeted estimate.
Privilege taxes were $22.2 million more than the April estimate, and on a year-to-date basis, August through April, revenues are $138.9 million more than the estimate.
Business taxes were $24.8 million more than the April estimate. For seven months, revenues are $37 million more than the budgeted estimate.
Hall income tax revenues for the month were $1.7 million less than the budgeted estimate. On a year-to-date basis, income tax revenues are $2.6 million more than the estimate.
Mixed drink, or liquor-by-the-drink, taxes were $6.1 million more than the April estimate, and on a year-to-date basis, revenues are $38.4 million more than the budgeted estimate.
All other tax receipts were less than estimates by a net of $0.1 million.
Year-to-date revenues, August through April, are $3.4 billion more than the budgeted estimate. The growth rate for nine months is 19.12 percent. General fund revenues are $3.2 billion more than the budgeted estimate and the four other funds are $185.1 million more than estimated.
The budgeted revenue estimates for 2021-2022 are based on the State Funding Board’s consensus recommendation of November 24, 2020 and adopted by the first session of the 112th General Assembly in April 2021. Also incorporated in the estimates are any changes in revenue enacted during the 2021 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.
On November 17, 2021, the State Funding Board met again to hear updated revenue projections from various state economists. Following this meeting, on November 23, 2021, the board decided to adopt revised revenue growth ranges for the current fiscal year. The recurring growth ranges adopted include a low of 6.80 percent to a high of 7.45 percent for total taxes and a recurring range low of 7.75 percent to a high of 8.50 percent for general fund taxes.
On April 21, 2022, in the second session of the 112th General Assembly, the Legislature passed the 2022-2023 budget, which included the Funding Board’s revised revenue ranges for the current year. Upon passage, an additional $2,936.5 million in total funds and $2,870.6 million in general fund revenue were added to this year’s original budgeted estimates. The appropriations bill is currently awaiting signature by Governor Lee.