TRENTON – While collections of the big three taxes – income, sales, and corporate taxes – are on par with the Treasury Department’s original projections for July, other taxes collected fell more than $34 million short of projections last month, according to the Treasury Department’s monthly revenue report released Friday.
In total, the state collected $335.6 million in tax revenues. That is about $34.8 million less than the $370.5 million it was anticipating to receive from nearly a dozen different state taxes.
The state collected $133 million in gross income taxes, $21.9 million in sales tax revenue and $47 million in corporate business taxes in July, Treasury reported. The original forecasts for last month by the Treasury Department were $133.4 million, $22 million and $47 million respectively.
While on track in those major sources of revenue, the state took a beating in other taxes. The biggest losers were the transfer inheritance tax and the casino revenue tax. The state originally projected $64.9 million in transfer inheritance tax revenue, but it actually collected $48.9 million, or about $16 million less than anticipated.
Similarly, the state projected $4 million in corporate banks and financial institutions taxes, but instead lost a total of $15.79 million.
In addition, the state’s motor fuel tax was anticipated to produce $600 million in revenues. Instead, the state had to refund $695 million because fuel merchants overpaid.
Treasury Department spokesman Andy Pratt said the shortfalls in the bank and motor fuels taxes were because money had to be refunded.
“Some people overpaid their taxes,” he said.
Pratt said the July figures reflect the actual amounts the state collected, which is a major change in reporting. In past reports, the state relied on accrual accounting, which is more dependent on assumptions and formulas that may or may not pan out, he explained.
Pratt said the reporting change brings it in line with the way the Office of Legislative Services reports its revenue collections.
Despite the overall shortfall, state Treasurer Andrew Sidamon-Eristoff said the relative consistency between his projections and the actual collection of the big three taxes is a positive sign.
“Though one month of collections certainly doesn’t constitute a trend, it’s reassuring that the earliest revenue figures are on target to meet Treasury Department projections for fiscal year 2012,” he said in a release.
Kean criticizes Dems
Senate Minority Leader Tom Kean, (R-21), of Westfield, said the figures show how off the Democrats were when it came to creating their own budget, which relied on much higher revenue projections from OLS.
“The Treasury Department has released actual tax collections for the month of July, and the numbers confirm what Republicans said in June: that the Governor’s revenue certification was fiscally sound,” Kean said in a statement. “While one month does not a trend make, it is heartening that the governor balanced the Democrats’ budget by veto. Had their revenue estimates been allowed to stand in this year’s budget, we would be in trouble if this month’s revenue tracking holds throughout the year.
“Given the fragile nature of the national economy, using conservative assumptions when budgeting is not ‘mean spirited’- it is a necessity,” he added. “To do anything else is to make the taxpayers of this state promises we cannot keep and for which we cannot pay.”