Providence, R.I. -- The Rhode Island Department of Revenue (DOR) today released its FY 2018 Revenue Assessment Report for August 2017. The Revenue Assessment Report, which is issued on a monthly basis, compares the adjusted general revenues by revenue source on a fiscal year-to-date and monthly basis to expected general revenues by revenue source. Expected general revenues are estimated by the DOR's Office of Revenue Analysis from the revenue estimates enacted in the FY 2018 budget. The methodology underlying the Office of Revenue Analysis' estimates is contained in the report.
1. August Year-To-Date Performance. On a fiscal year-to-date basis, the August 2017 report shows that adjusted total general revenues are behind expected total general revenues, based on the revenue estimates enacted in the FY 2018 budget and the Office of Revenue Analysis' estimation methodology, with adjusted total general revenues $5.7 million less than expected total general revenues, a variance of 1.2 percent. The major contributors to this shortfall are business corporation tax revenues, $4.9 million less than expected; sales and use tax revenues, $2.0 million below expectations; estate and transfer tax revenues, $2.0 million less than expected; and departmental receipts revenues, $1.8 million below expectations. A total of nine individual revenue items trailed their estimated values on a year-to-date basis through August.
2. August Monthly Performance. For the month of August, the report shows that adjusted total general revenues are ahead of expected total general revenues, based on the revenue estimates enacted in the FY 2018 budget and the Office of Revenue Analysis' estimation methodology, with adjusted total general revenues $5.8 million more than expected total general revenues, a variance of 2.2 percent. The major contributors to this overage are personal income tax revenues, $5.7 million more than expected with strong growth in withholding tax payments revenues; sales and use tax revenues, $2.6 million above expectations; and cigarettes tax revenues, $1.1 million more than expected. A total of 11 revenue items exceeded their estimated amounts for the month of August.
Regarding August year-to-date performance, Director of Revenue Robert S. Hull made the following observations: • Fiscal year-to-date revenues through August were behind expectations by $5.7 million, or 1.2 percent and nearly half the deficit that was calculated in July. • Adjusted personal income tax revenues were $4.7 million above expectations, a variance of 2.6 percent. o Adjusted personal income tax withholding payments through August were $10.6 million more than estimated, or 6.0 percent. These results are consistent with an improving labor market in the state. o FY 2018 through August adjusted personal income tax refunds and adjustments were $7.0 million more than expected, a variance of 62.9 percent. This outcome is attributable in part to the working down of a backlog of refunds carried over from prior tax years. • Fiscal year-to-date adjusted business corporation tax revenues through August were short of expectations by $4.9 million, or 36.8 percent. Some of this shortfall may be due to the change in the due date of final returns for tax years beginning on or after January 1, 2016. • Adjusted sales and use tax revenues were $2.0 million below the estimate, a variance of 1.0 percent. • Fiscal year-to-date adjusted estate and transfer tax revenues through August were $2.0 million less than expected or 49.6 percent, after accounting for the accrual to FY 2017 of $58.0 million of payments received in July. • Adjusted departmental receipts revenues were $1.8 million below expectations, a variance of 7.1 percent.
Regarding August monthly performance, Director of Revenue Robert S. Hull made the following observations: • August adjusted revenues were ahead of expectations by $5.8 million, or 2.2 percent. • Adjusted personal income tax revenues for August were $5.7 million above expectations, a variance of 5.9 percent. o August adjusted personal income tax withholding payments were $6.1 million more than estimated, or 6.4 percent and indicative of a strong labor market in the state. o Month of August adjusted personal income tax refunds and adjustments were $1.7 million more than expected, a variance of 33.6 percent while both personal income tax estimated and final payments revenues were ahead of monthly expectations by 21.1 percent and 18.5 percent respectively. • August adjusted business corporation tax revenues were short of expectations by $4.0 million, or 77.3 percent with some of the shortfall likely due to the change in the due date of final returns for tax years beginning on or after January 1, 2016. • Adjusted sales and use tax revenues for August were $2.6 million ahead of the estimate, a variance of 2.8 percent and includes sales taxes remitted by Amazon from Prime Day, its largest single day of sales ever. • August adjusted cigarettes tax revenues were $1.0 million more than expected or 8.0 percent and include cigarette floor stock tax revenues of $284,349 which were below estimated cigarette floor stock tax revenues of $996,688 for August. • Adjusted estate and transfer tax revenues for August were $1.0 million below expectations, a variance of 47.8 percent.
The entire report can be found on the Department of Revenue's web site, www.dor.ri,gov, under the Revenue Analysis header on the State Reports tab.
Questions or comments on the report should be directed to Paul Grimaldi, Chief of Information and Public Relations by e-mail at paul.grimaldi@revenue.ri.gov or by phone at (401) 574-8766.