May Sales Tax Collections Top Forecast, Officials Urge Caution
Florida sales tax collections last month topped estimates for the first time in almost three years, state officials reported Tuesday, while also warning the rosy numbers should not be seen as a sure sign of economic rebound.
The state’s general revenue collections, steadily dropping for most of the past three years, are $56.2 million above what economists forecast in March for the budget year that ends next month. The surplus follows back-to-back months of better-than-expected collections.
But May also was the first time since September 2006 that sales tax collections topped what was forecast. Florida’s 6 percent state sales tax provides 3 out of every 4 general revenue dollars – the real fuel for the engine of government.
General revenue is expected to top $20 billion for the 2008-09 year, which ends June 30.
The uptick came even as consumer confidence in the state dropped slightly in May, according to the University of Florida which tracks the trend.
“You can’t read too much into the over-estimate right now,” said Amy Baker, coordinator of the Legislature’s Economic, Demographic and Research Office, and among a panel of four economists who prepare the state’s fiscal forecast. “We’re pretty much on track and that means the state budget should be okay. But Florida’s economy is stabilizing. And that can really be saying something after three years of instability,” she added.
While the $1.3 billion in sales tax collections topped estimates by a modest $3.4 million in May, corporate income tax receipts were up 60 percent, to $46 million. Documentary stamp taxes, earned from real estate transactions, also climbed 20 percent above forecasts, to $8.3 million. Corporate filing fees rose 29 percent to $57.8 million.
Less lucrative medical hospital fees, insurance premium taxes, and service charges assessed by state agencies were the revenue sources falling below expectations, Baker’s office reported Tuesday.