Treasury: September Revenue Collections Up Again

(TRENTON) — The Department of the Treasury reported that September revenue collections for the major taxes totaled $4.563 billion, up $1.095 billion, or 31.6 percent above last September. Fiscal year-to-date, total collections of $7.362 billion are up $1.755 billion, or 31.3 percent above the same three months last year.

September collections for the Gross Income Tax (GIT), which is dedicated to the Property Tax Relief Fund, totaled $1.907 billion, up $257.6 million, or 15.6 percent above last September. Year-to-date GIT collections of $3.067 billion are up $682.6 million, or 28.6 percent. Growth is spurred primarily by two factors – employee withholding collections are recovering from weaker levels during the pandemic; and refund levels are down substantially, returning to normal for this time of year, after delayed taxpayer filing deadlines last year.

The Sales and Use Tax, the largest General Fund revenue source, reported $935.7 million, an increase of $87.3 million, or 10.3 percent, above last September. Year-to-date Sales Tax collections of $1.906 billion are up $166.8 million, or 9.6 percent higher than the same period last year. Due to the one-month lag in the reporting of Sales Tax collections, September revenue reflects consumer activity in August.

The Corporation Business Tax (CBT), which is the second largest General Fund revenue source, reported $1.027 billion in September, an increase of $385.2 million, or 60.0 percent – marking the strongest September collection ever for this tax. Year-to-date through September, CBT collections of $1.235 billion are up $450.8 million, or 57.5 percent above the same period last year. Collections are being driven by strong quarterly estimated payments for Tax Year 2021.

Robust revenue collections to date are encouraging. However, Treasury expects FY 2022 collections growth to moderate into the winter months as the substantial federal income stimulus fades.  In addition, the recent expansion and establishment of various tax relief programs, including the Earned Income Tax Credit, the retirement income exclusion, and several college savings programs, will soften revenue collections in the spring.