LITTLE ROCK — State revenues in September were above forecast and above last year, but the director of the state fiscal office said Tuesday a dip in sales tax collections for a third straight month was a concern.
“There is just not any clear-cut reason we are able to see where any weakness is,” state Department of Finance and Administration Director Richard Weiss said of the decline in sales tax revenue.
September sales tax collections totaled $177.8 million, a decrease of $1.2 million or 0.7 percent from last year, and $7.2 million or 3.9 percent below forecast.
Weiss said the drop could have occurred because businesses and individual consumers are holding onto their money until they feel comfortable that the economy is improving.
“Car sales were down, business is down and individual spending is down,” he said. “It could well be the continuing story with business that they’re kind of keeping cash … and waiting to figure out what’s going on with the economy before they start replacing a bunch of machinery and equipment and things like that. I think the consumers are doing the same thing.”
The state’s net available revenues in September totaled $494.7 million, $31.9 million or 6.9 percent above last year and $29.9 million or 6.4 percent above forecast.
The increases, Weiss said, were driven by gains in individual income tax from both withholding and estimated payments. Individual withholding increased 18.1 percent compared to last year because of a payroll timing issue, he said, adding that both withholding and estimated payments contributed to the September gains.
Income tax collections totaled $275.5 million in September, an increase of $36.7 million or 15.4 percent over last year and $29.8 million or 12.1 percent above forecast.
Individual income tax refunds for the month totaled $4.7 million, down $2.5 million or 34.8 percent from last year and $2.7 million or 36.3 percent below forecast.
Corporate income taxes totaled $66.1 million, down $5.1 million or 7.8 percent from last year and $1 million or 1.6 percent below forecast.