Va. General Fund revenue increased 15.1% in December 2020
Increase driven by payroll withholding, corporate income tax, sales and use tax
Virginia’s General Fund revenue for December 2020 increased 15.1% compared with December 2019, Gov. Ralph Northam announced Wednesday.
Total revenue collections rose 7.8% through December on a fiscal year-to-date basis, which was well ahead of the 1.2% growth forecast. The increase was driven by growth in payroll withholding, corporate income tax, sales and use taxes, and recordation tax collections, according to the governor’s statement.
“Our diligence in following our long-term financial plan has put Virginia in a stronger position to weather this health crisis and ensure a sustainable recovery,” Northam said in a statement. “As we look ahead to a post-pandemic world, this continued solid revenue performance gives us confidence that we can meet our budget priorities, enhance our cash reserves and provide relief to Virginians who need it.”
Payroll withholding tax collections grew 10.6% during December 2020 and — thanks to the holiday shopping season — sales and use tax collections (reflecting November sales) rose 5.2% in December 2020.
“A clearer assessment of the season will be possible after receiving December sales tax payments due in January,” Secretary of Finance Aubrey Layne said in a statement. “January nonwithholding payments will also give us a better indication of taxpayer behavior for calendar 2020 tax returns.”
Corporate income tax collections increased 37.7% during December 2020 compared to December 2019 and collections of wills, suits, deeds and contracts (mainly recordation tax collections) were $63.6 million — $40.4 million more than the same time in 2019.
Ahead of a forecasted 1.2% increase, total revenue collections rose 7.8% on a fiscal year-to-date basis. Payroll withholding tax collections (which comprise 63% of General Fund revenues) increased 2.9%, slightly ahead of the annual estimate of 2.7% growth.