Kansas’ tax collections have been better than expected since July, some good news as the COVID-19 pandemic have hit state budgets hard nationwide.
The state is $108.4 million ahead of its estimated projections, with $2.3 billion in total tax collections for the first quarter of this fiscal year, said Gov. Laura Kelly. The quarter ended Wednesday.
Compared to the same three-month period last year, that’s a 29.7% increase in revenue, most of it due to the fact that the income tax filing deadline was pushed back as a result of the pandemic.
"Since I took office, my administration has returned to responsible fiscal practices that have allowed Kansas to successfully remain financially healthy, even as we respond to the COVID-19 pandemic," Kelly said in a news release. "While there is optimism with these projections, we must remain committed to fiscal steadiness, public health and support our core services like education, infrastructure and economic development, which will enable Kansas to remain on the path to recovery."
While revenue is better than expected, the virus’ effects are still seen when compared to pre-pandemic levels. September's total tax collections were $728.9 million, a 2% decrease from the previous September.
Individual and corporate income tax collections beat out projections, with corporate tax revenue being 50% more than expected. In total, Kansas saw around $450 million in income tax revenue.
Retail sales tax revenue was 1.2%, or $2.4 million, less than the estimate, with $195.6 million collected. The governor’s office attributed the decline to temporary changes in consumer habits as the school year started.
But compensating-use tax collections are seeing growth, the state said, partially due to more online consuming and "increased registrations of out-of-state retailers to collect and remit taxes to the state."
It remains to be seen how tax collections will continue to fare for the rest of the year.
"The impact that the pandemic will have on the economy during the fall and winter months is uncertain at best," said Secretary Mark Burghart of the Department of Revenue.