Sales tax dip pushes budget shortfall near $200M

Tuesday, March 9, 2010 at 3:43pm
Staff reports

State tax collections were less than the year before for a record 21st straight month in February, the Bredesen administration reported Tuesday.

Revenue was $47 million less than the state budgeted for the month, increasing the shortfall for the year to $196 million.

"The entire fiscal year has brought us negative growth in the sales tax, which is almost two-thirds of our revenue," Finance Commissioner Dave Goetz said. "Moreover, the running total is now 21 consecutive months of negative growth in sales tax collections since January 2008, when the downward economic spiral began in Tennessee."

Sales tax collections were $38 million less than the budget estimate for February. Franchise and excise taxes combined were $1.4 million above the budgeted estimate of $33 million. Gasoline and motor fuel collections for February decreased by 3.8 percent, but were $180,000 above the budgeted estimate of $68 million. Tobacco tax collections were $4 million under the budgeted estimate of $23 million.

2 Comments on this post:

By: Kosh III on 3/10/10 at 7:20

Expect the governor to make up this shortfall by laying off more state employees.
Like the last time, it will be an opportunity to eliminate the low-paying people who do the real work---the top level will not be touched; after all they just got a massive pay raise. Some, like Kisber got almost 100% increase.

Of course the legislature gave itself a raise this year too.

Sometimes you have to find ways to increase income: eliminate the billion or so in sales tax loopholes that wealthy special interests already have. Add sales tax onto ALL sales: lawyer fees, architects, accountants and more special exemptions.

By: bfra on 3/10/10 at 9:50

State & Metro have been spending money like drunk sailors, for special interest, or on themselves, what did they expect!