Kansas tax receipts fell $6.8 million short of estimates in January

Tax receipts in Kansas fell below estimates again in January, missing by $6.8 million, the Department of Revenue reported Monday.

Corporate income taxes were below expectations by $8.2 million, and sales tax revenue came in under projections by $3.9 million. But state officials saw a silver lining in individual income tax receipts, which were $8.2 million above expectations.

“We are pleased to see individual income tax receipts continuing to grow compared to last year,” Kansas Revenue Secretary Nick Jordan said in statement.

“Corporate income taxes — which have not had a rate change — and sales tax receipts continue to struggle in part because of weaker aviation, oil and agriculture sectors.”

Total tax receipts for January, money collected by the Revenue Department and other agencies, were $535 million, which was $6.8 million below estimates.

Ongoing revenue shortfalls are more than a nagging concern.

The House Appropriations Committee and Senate Ways and Means Committee this week plan to address a big hole in the state budget, an effort that will get more complicated if tax receipts continue to lag.

“The revenue numbers are a reflection of a downward trend in retail sales that is affecting many states in the region,” said House Speaker Ray Merrick, a Stilwell Republican. “Even so, the Appropriations team is putting together a deliberative and thoughtful budget solution.”

Gov. Sam Browback last month proposed money transfers and other maneuvers to fill an estimated shortfall of about $190 million in the current and fiscal year 2017 budgets. He proposed no tax increases.

The measures would include transferring about $27 million from the state highway fund to the general fund and selling assets of the Kansas Bioscience Authority, which plans to take its efforts private, bringing in $25 million.

Millions more would come from a children’s health coverage fund because of an offset in increased federal dollars and savings from lower-than-expected expenses for teacher pension contributions.

Balancing the state budget has been a struggle since Brownback and the Republican-dominated Legislature cut incomes taxes in 2012 and 2013 to spur job growth. Last year, the Legislature raised sales and cigarette taxes to fix a large budget gap.

Last month’s revenue report was a disappointment. Individual income tax receipts were about $26 million below projections in December, and sales tax receipts came in $14 million below expectations. November’s overall receipts beat projections, although that came after revenue estimates were revised downward for the fiscal year that will end in June.

This story was originally published February 1, 2016 at 3:24 PM with the headline "Kansas tax receipts fell $6.8 million short of estimates in January."