Key state tax projections see little change
TALLAHASSEE, Fla. – The forecast for state revenue remained stable as analysts Thursday approved a new projection of the key funding sources for Florida’s budget, including sales taxes and corporate income taxes.
Amy Baker, coordinator of the Legislature’s Office of Economic and Demographic Research, said the forecast for state general revenue “is virtually unchanged overall.”
The analysts’ periodic forecasts are important because they help determine how much money lawmakers will have to spend each year. General revenue is a critical part of the state budget because it heavily funds education, health care and prison programs.
The state finished the 2017-2018 fiscal year on June 30 with revenues exceeding a prior projection by some $205 million. But nearly 60 percent of that surplus was one-time funding, including $52 million from Seminole Tribe gambling revenue and $30 million in what are known as Medicaid “achieved savings” rebates.
In addition, the new forecast includes “slightly weaker” projections for near-term economic conditions, Baker said.
The net result cut the general revenue forecast by about $33 million over two years, including $13.1 million in the current budget year and $19.5 million in the 2019-2020 year, which will start next July. The reduction amounts to less than one-tenth of 1 percent of the estimated $32.2 billion in general revenue that will be collected this year.
Current-year general revenue collections are expected to be $1.03 billion, or 3.3 percent, higher than in 2017-2018, the forecast showed. And the 2019-2020 general revenue total is projected at $33.3 billion, a $1.09 billion increase, or 3.4 percent, over this budget year.
One of the largest changes made by the estimating conference involved the corporate income tax, which accounts for more than $2 billion a year in general revenue.
Based on increased collections in latter months of 2017-2018, the new forecast increased the projected corporate-tax collections by $86 million this year and $77 million for 2019-2020.
Sales tax collections, the largest source of general revenue at more than $25 billion a year, were adjusted slightly downward. This year’s forecast was cut by $21.3 million and the 2019-2020 estimate was reduced by $57 million.
The current-year forecast retains a $117.8 million boost in sales tax activity related to the rebuilding and recovery after last year’s Hurricane Irma.
State analysts will make another general revenue forecast before the Legislature passes a 2019-2020 state budget. The Legislature begins its annual 60-day session in March, and the new budget takes effect July 1. The current state budget is about $89 billion, which includes general revenue and numerous other state and federal funding sources.
News Service of Florida