ATLANTA – Georgia tax collections continued their downward slide last month, declining by 12.6% compared to March of last year, the state Department of Revenue reported Friday.
Year-to-date tax receipts were more encouraging, with revenues down a slight 0.5% compared to the first nine months of the last fiscal year.
However, that’s only because the state has resumed collecting taxes on gasoline and other motor fuels, a tax Gov. Brian Kemp suspended during most of last year. Not counting those revenues, state tax collections actually fell 4.3% during the first nine months of fiscal 2024.
Individual income taxes declined by 16.1% in March compared to the same month a year ago, in part because Kemp and the General Assembly cut the state’s income tax rates effective Jan. 1.
Net sales tax receipts also fell by 4.5% last month compared to March of last year. Corporate income tax collections dropped by 28.3%, as refunds issued by the revenue agency rose by 88% while payments were down by 91.8%.
Despite the slowdown in tax revenues, which the governor’s Office of Planning and Budget expected, Georgia lawmakers adopted a record $37.9 billion midyear budget in February that includes $5.5 billion in new spending.
A month later, the legislature approved a $36.1 billion spending plan for fiscal 2025, which takes effect in July. It includes 4% cost-of-living raises for most state and university system employees, with an additional $3,000 for those in state agencies hit hard by turnover, including law enforcement and welfare workers.
The largesse stems from a $16 billion budget surplus the state has built up during the last three years.