The Utah Tax Commission released its TC-23 Revenue Summary Wednesday, June 17th, 2020, detailing the actual collections through 11 months of Fiscal Year 2020. As expected, individual income taxes are down, partially due to the shift in timing of income tax collections from FY 2020 to FY 2021, as well as the effects of COVID-19. While consumption patterns may have changed, sales and use tax revenues actually increased 9.2% over the same collection period in FY 2019.
The State Revenue Snapshot published by the Legislative Fiscal Analyst and the Governor’s Office of Management and Budget compares the revenues reported by the Tax Commission to economic projections upon which state budgets are based. The latest projections include adjusted expectations for income taxes associated with an extended filing date, and an attempt to capture the impact of reduced income tax revenue associated with decreases in employment and wages. The snapshot reports Education Fund revenue sources down (12.6%), which exceeds the consensus projections by (1.1%). Revenue sources to both the General and Education Funds are down (6.5%), representing a (1.0%) greater decline than was forecasted. Defying expectations, the Transportation Fund revenue sources actually increased 0.1% over the previous fiscal year.
The final period of any fiscal year is typically volatile due to final tax payments and year-end adjustments. Revenues reported in this month’s TC-23 report and analyzed in the Revenue Snapshot represent wages and sales which took place in the month of May. The course of the pandemic and associated recession will determine the final, year-end numbers for tax revenues reported next month. The projections included in the Revenue Snapshot assume limited adverse impacts in the fall associated with the pandemic, and carefully estimate impacts of Federal stimulus money. These projections will be updated as better information is available.