Missouri tax revenues fall again in May

Associated Press WriterJEFFERSON CITY, Mo. (AP) -- State tax revenues plunged 11.6 percent in May when compared to last year, widening the gap between the revenues Missouri actually has received and what it expected to get.

The decline in May was due partly to a decrease in state sales tax revenues and a surge in tax refunds, which were nearly double the amount distributed in May 2002, the state Revenue Department said Wednesday.

Based on an early review of the numbers, Gov. Bob Holden's budget director said Monday that she would recommend the governor make another $17 million in spending cuts before the 2003 fiscal year ends June 30.

Through the first 11 months of the fiscal year, general state tax revenues are 4.1 percent below the same period in 2002, the Revenue Department said.

The decline becomes more pronounced when contrasted to the fact that the current budget was based on an expected general revenue growth of 3.1 percent over 2002.

General revenues consist largely of income and sales tax revenues but also include taxes on alcohol, state licensing fees and the interest the state receives on its money. Not included are federal funds or dedicated taxes, such as the motor fuel tax that benefits transportation.

The pool of general revenues provides the primary state funding for such things as public schools, colleges and prisons.

Through the first 11 months of the fiscal year, sales taxes are down 1.6 percent compared to last year and individual income taxes are down 2.4 percent. Corporate income and franchise taxes, which comprise a comparatively small portion of the overall tax revenues, are down 16.3 percent from 2002.

Because of the lower-than-expected revenue collections, Holden already has withheld $362 million that had been appropriated in the current budget, with the most recent round of cuts coming May 23.

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Department of Revenue: http://www.dor.state.mo.us