Kansas Tax Receipts Continue Upswing In February

Mar 1, 2017

Kansas tax receipts came in about $37 million above estimates in February, chipping away at the state’s budget deficit.

The Kansas Budget Office on Wednesday reported about $331.5 million in tax receipts for the month, which was about 13 percent higher than projected revenue. Tax revenues were up about 9 percent compared to February 2016.

State tax collections have exceeded estimates since November, when the Consensus Revenue Estimating Group lowered its projections for the rest of fiscal year 2017. Collections fell short of estimates for the first four months of the fiscal year.

Secretary of Revenue Sam Williams said he was pleased to see growth in individual income taxes.

“Month-to-month sales tax(es) have increased 2.4 percent,” he said in a statement. He added that was “a hopeful sign that Kansans’ income growth means they have more money to spend.”

Total revenues for February came in around $326.7 million because transfers offset some of the state’s income. Kansas still has a budget gap of roughly $281 million for the current fiscal year that ends June 30.

Rep. Steven Johnson, an Assaria Republican who serves as chairman of the House Taxation Committee, said Wednesday that the additional revenue will make it easier for the House and Senate to agree on a tax plan for next fiscal year.

For example, the chambers could avoid a fight over whether tax increases should be retroactive if the extra revenues help keep the state out of the red until January 2018, he said.

“We still need to make sure we have a tax plan that will drive the revenue that’s needed,” he said.

Last week the Legislature and Gov. Sam Brownback battled over a tax plan that would roll back some income tax cuts adopted in 2012. The House and Senate approved the plan but were unable to come up with enough votes to override the governor’s veto. They are on a midsession break this week but return Monday to resume work on a budget.

“We still need to make sure we have a tax plan that will drive the revenue that’s needed.”

While revenues have met the lowered projections, they haven’t come close to the original estimate overall. In November the estimating group cut its projections for the rest of the fiscal year by $346 million. So far, revenues have exceeded the lower estimates by about $68 million, though the state could make up more ground in the remaining four months of the fiscal year.

Tax collections in the current fiscal year have been higher than they were in the previous year in six out of eight months so far. Of the taxes Kansas levies, individual income receipts have been above 2016 more often than other taxes, though they still were prone to significant swings from month to month.

So far, tax revenues are up about $17.6 million compared to the previous fiscal year. The difference amounts to less than 0.5 percent.

Meg Wingerter is a reporter for KCUR’s Kansas News Service, a collaboration of KCUR, Kansas Public Radio and KMUW covering health, education and politics in Kansas. You can reach her on Twitter @MegWingerter. Kansas News Service stories and photos may be republished at no cost with proper attribution and a link back to kcur.org.