COLUMBIA — So far this fiscal year, Missouri has seen a sharp drop in the amount of money it collects from taxes on corporations and franchises, but total revenue in the state's general fund has increased.
The state's net general revenue in September was 1.5 percent lower than September 2010, but the revenue for the first quarter of fiscal year 2012, which began July 1, is up 1.9 percent from the same period last year.
Individual income tax collections
- Increased 1 percent in September
- Increased 2.2 percent for the fiscal year, from $1.22 billion last year to $1.25 billion this year.
Sales and use tax collections
- Decreased 1.2 percent in September
- Increased 3.1 percent this fiscal year, to $467.1 million this year from $453.1 million last year
Corporate income and franchise tax collections
- Decreased 20.3 percent in September
- Decreased 20.6 percent this fiscal year, down to $103.5 million this year from $130.5 million last year.
Source: State Budget Office
"I wish that September were better," said state Rep. Chris Kelly, D-Columbia.
State Budget Director Linda Luebbering said her office tends to focus more on the year to date numbers.
"It's some growth," she said. "Not stellar growth, but it's nice to see a positive number."
Luebbering said she finds the numbers for the corporate income and corporate franchise tax revenue troublesome. At the start of the fiscal year, she expected those revenue categories to rise. The dramatic decline, about 20 percent, is due to changes to the tax code at the federal level. For example, businesses are now allowed to write off more depreciation, Luebbering said.
"Since our tax code is tied to the federal code, we lose money as well," she said.
Luebbering said there is some concern that the drop could portend future revenue problems for the state.
Revenue from individual income taxes — the state's largest source of revenue — increased. Luebbering said the increase likely is the result of people working longer hours, and some might have received small pay increases.
"There is some growth to point to, but that's relatively small growth compared to a typical year," she said. "It's positive, which is good, but it's not growing the way we'd like to see it grow."
According to the September General Revenue Report, sales tax collections decreased by about 1 percent but are up about 3 percent overall this fiscal year.
"That's good news because our sales taxes have taken a steep hit over the last few years," Luebbering said.
Kelly said sales tax holidays have hurt state revenue.
"If we’re going to get ourselves out of the situation we’re in now, we have to build things," he said. "We have to take responsibility for changing the situation in a serious way. That means we need to build highways or power plants or the engineering school."
Luebbering said fiscal year 2008, when the state collected a total of $1.9 billion in sales taxes, was the last time the state had "normal" revenue. In the first three months of fiscal 2012, it had collected $476.1 million. That's an increase of $14 million over the same period a year ago and puts the state on pace to collect $1.9 billion this year.