AUGUSTA, Maine - After the first four months of the budget year, state revenues are up $27.6 million above estimates.
Finance Commissioner Richard Rosen says the October revenue report was “strong” with overall tax receipts $17.7 million above projections.
“Corporate income tax collections look good, coming in above projections, strong on the individual income tax, other tax lines good," he told MPBN news. "Sales tax still coming in a little bit under from what we are projecting, although there are categories in the sales tax that continue to show strength.”
Rosen says overall tax collections are up 10 percent over the same time period a year ago. Rosen said the sales tax continues to lag slightly behind projections, down $4 million, but there are also some bright spots overall for the sales tax line.
“Maine, like the rest of the country, is showing only very slow growth,” he said. “The other categories (of the sales tax), like vehicle purchases and home building supplies, continue to be the area where strength is.”
Sales tax from car and truck purchases are running nearly 5 percent over a year ago and building supplies are up just over 3 percent. General merchandise, in contrast, is nearly flat over a year ago. The sales tax numbers concern Rep. Peggy Rotundo, D-Lewiston, co-chair of the legislature's Appropriations Committee.
"I look on the sales tax as an indicator of how well the average Maine family is doing, " she said. "It's clear they are still not doing that well with the sales tax still below."
Rotundo said she is pleased that overall state revenues are in excess of projections so far this budget year. She said there will be plenty of demands on any additional funds that are available.
“We have had some issues in projecting final income tax payments," Rosen said, “with tax conformity issues and timing of tax payments.”
Most of the increased revenue in October was the result of higher than expected final income tax payments from taxpayers that had an extension to file taxes. "And the corporate income tax is doing better than expected,” he said.
The corporate income tax is up 9.7 percent, which is $4.4 million more than projected. Rosen said while the economy is not growing very fast, it is continuing to improve and that is being reflected in state revenues.
