Arkansas’ coffers grew in May, with the state’s net available general revenue totaling $655.2 million.
For the month, Arkansas was 67.1 percent, or $263.2 million, above the state’s forecast for May’s revenue. Compared to May 2020, the state was up 79.1 percent, or $289.3 million in 2021.
So far in the latest fiscal year, Arkansas’ net available general revenues have totaled $6.1 billion. This is $941 million, or 18.2 percent, above the net revenue levels in 2020.
With rising revenues after the COVID-19 pandemic, Arkansas has accumulated a significant revenue surplus in the fiscal year-to-date. According to the Arkansas Department of Finance and Administration’s June report, the state is $980 million, or 19.1 percent, above forecast, for the fiscal year. Gov. Asa Hutchinson called this the “largest surplus in the history of Arkansas,” in a statement from his office.
“This fact underscores the importance of the belt-tightening decisions we made during the pandemic and the strength of our economic recovery. The record surplus also tells us that this fall will be the right time to cut our individual income tax rate again,” he said. “This surplus has been created despite reducing our tax rate this year to 5.9%. This shows we can fund education, raise teacher pay and protect public safety at the same time we are lowering our tax rate. It is all because our private sector continues to grow.”
Individual income tax collections were up in the year-to-date, while income tax refunds were down. Income tax collections were up to $3.64 billion, an increase of $524.1 million, or 16.8 percent, from the last fiscal year. This was also 17.4 percent, or $539.2 million, above the state’s projections for the current fiscal year. However, individual income tax refunds dropped to $460 million, a decrease of 2.9 percent or $13.9 million compared to last year.
In May, individual income tax collections amounted to $471.7 million, an increase of 100.4 percent or $236.3 million, compared to May 2020. The May 2021 income tax collections were above forecast by $247.4 million or 110.3 percent.