LITTLE ROCK — State revenues fell slightly below projections in August, caused by sales tax collections that did not meet expectations, the state fiscal office reported Wednesday.
August sales tax collections totaled $178 million, $2.8 million, or 1.5 percent, below the same time last year and $9.3 million, or 5 percent, below the monthly forecast, according to the state Department of Finance and Administration.
Figures from the statewide sales tax holiday on back-to-school purchases held the first weekend in August were not reflected in Wednesday’s report — that estimated revenue loss of about $2.1 million will be seen the September report. But the August drop in collections could have resulted from people waiting for the sales tax holiday before making school purchases, said DF&A Director Richard Weiss.
“That could well have something to do with it — people holding off in June and July and making those buying decisions (in August),” Weiss said.
He also said people might be paying off debt rather than purchasing new items.
“They’re not going out and spending as much money, but lowering their debt, which is a healthy thing for the economy,” he said.
Total revenue collections in August totaled $369.1 million, $4.6 million, or 1.2 percent, below last year and $3 million, .8 percent, below the monthly forecast.
Individual income tax collections totaled $189.7 million, down $2.2 million, or 1.2 percent, from last year and about $700,000, or .4 percent, above the monthly forecast.
Corporate income tax collections totaled $3.7 million, down a $1.7 million, or 33 percent, from last year, and $1.7 million, 30.9 percent, below forecast.
Weiss attributed the drop in corporate income tax collections to August generally being a low month for collections.
“The only real issue in all of this, I think, …is in sales tax and we’re seeing slippage there. It’s something we are going to keep our eyes on, keep looking at and see where it goes,” he said.