State General Fund revenue down only 0.2% in August

Despite the pandemic, Gov. Ralph Northam announced Thursday that August General Fund revenue collections decreased only 0.2% compared to the same time last year.

“Despite trying economic conditions, collections from payroll withholding and sales taxes remained steady,” Northam said in a statement. “We look forward to September’s receipts, which will provide more insight into Virginia’s financial picture.”

Payroll withholding tax collections decreased 4% in August and sales and use tax collections (which reflect July sales) increased 1.2%. Recordation taxes from real estate transactions increased by 31.3%.

“September collections will complete the first quarter of fiscal year 2021,” Secretary of Finance Aubrey Layne said in a statement. “Close to $250 million of July’s collections were from individual and corporate income tax payments that were originally due June 1. September receipts will provide a much clearer assessment of fiscal year 2021 collections and trends.”

On a year-to-date basis, payroll withholding tax collections (which make up 64% of General Fund revenues) were down by 1.9%, less than the estimated 2.4% annual increase. Sales tax collections (which comprise 16% of General Fund revenues) increased 15%, greater than a forecast 9.7% decline. Total revenue collections rose 11.6% in August on a year-to-date basis. Those collections were forecast to have a 1.8% decline.

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