State tax collections top expectations
With inflation pushing up prices of taxable items, Florida’s general revenue substantially topped expectations in June and in the recently completed state fiscal year.
General-revenue collections in June were $978.7 million, or 27.6 percent, higher than projected, according to a report posted online Thursday by the Legislature’s Office of Economic & Demographic Research.
The June numbers also marked the end of the 2021-2022 fiscal year.
The report said the state took in nearly $3.85 billion, or 9.6 percent, more than forecast for the year.
Florida brought in $693 million more in sales taxes than expected in June, reflecting higher prices for taxable items.
But state economists remain concerned inflation could ultimately affect consumer spending.
The report said persistent inflation conditions “ultimately suppress (tax) collections as consumers begin to spend more money on non-taxable necessities like food and health care.”
It added that “prices for food at home increased by 12.2 percent in June, the largest 12-month percentage increase since the period ending April 1979.”
Consumer-price index figures released Wednesday by the U.S. Department of Labor showed prices in July were 8.5 percent higher than a year earlier. While still nearly a 40-year high, the rate was down from 9.1 percent in June.
Meanwhile, the report by state economists said the personal-savings rate, the percentage of disposable income that people save, was 5.1 percent in June.
That was down from 5.5 percent in May. During the 2018-2019 fiscal year, the last full fiscal year before the COVID-19 pandemic, the savings rate was 7.9 percent.
Aided by federal stimulus money, the savings rate ballooned to 33.7 percent early in the pandemic.
General revenue is closely watched because it plays a key role in funding programs such as education, health care and prisons.