Tennessee, nearly $280M behind tax collection estimates, will adjust predictions

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(The Center Square) – Tennessee has now collected $279.9 million less than budgeted through the first five months of the fiscal year.

December’s $1.9 billion in collections were $82.5 million less than budgeted In numbers released Friday afternoon.

The December collections were $31.5 million less than December 2022.

Tennessee Department of Finance and Administration Commissioner Jim Bryson said the numbers came in lower than expected and now the state will adjust.

“Because of slowing tax collections, the administration plans to recommend a lowered revised revenue estimate for the current fiscal year,” Bryson said. “As such, we will continue to closely monitor state finances and remain committed to maintaining a balanced budget.”

Sales taxes are the largest portion of collections and came in nearly $900,000 below the estimates but were around $33 million higher than December 2022.

Franchise and excise tax collections of $528.6 million were $66.5 million below the budgeted estimates and $65.8 million behind December 2022.

“Sales tax receipts, reflecting November consumer activity, rebounded nicely following the state’s three-month food sales tax holiday and suggests that consumer behavior remains resilient,” Bryson said. “Most of the revenue shortfall for the month can be attributed to reduced franchise and excise tax receipts and diminished revenues from real estate transaction fees, reported within the privilege tax. All other taxes combined revealed modest growth.”

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