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R.I. Department of Revenue releases Special Report on Preliminary State Revenues

Providence, R.I. --The Rhode Island Department of Revenue today released its FY 2016 Special Report on Preliminary Revenues. This report provides a detailed look at FY 2016 preliminary revenues as provided in the Controller's Preliminary General Fund Revenue Report for FY 2016 and compares these revenues to both the final enacted FY 2016 revenue estimates and the audited FY 2015 revenues as provided in the Final General Fund Revenue Report for FY 2015. Some of the detail information is derived from reports generated by the Division of Taxation and the Division of Lottery. This report should be viewed as a complement to the Controller's Preliminary General Fund Revenue Report for FY 2016.

The FY 2016 Special Report on Preliminary Revenues shows that preliminary FY 2016 total general revenues exceeded the final enacted FY 2016 revenue estimates by $28.6 million or 0.8 percent. Preliminary FY 2016 total taxes and departmental receipts revenues finished ahead of the final enacted FY 2016 total taxes and departmental receipts revenues by $26.6 million or 0.8 percent. The largest portion of this difference is attributable to total taxes which were $22.7 million, or 0.8 percent, more in preliminary FY 201 revenues than the final enacted FY 2016 revenue estimates. Preliminary FY 2016 other general revenue sources were $2.0 million, or 0.5 percent, ahead of the final enacted FY 2016 revenue estimate of other general revenue sources.

Regarding preliminary FY 2016 revenues and final enacted FY 2016 revenue estimates, Director of Revenue Robert S. Hull made the following observations: Preliminary FY 2016 total general revenues were $28.6 million more than final enacted FY 2016 total general revenues. The outperformance in preliminary FY 2016 total general revenues was driven substantially by the receipt of large infrequently occurring estate tax payments of over $52 million in May and June 2016. The spread between preliminary FY 2016 and final enacted FY 2016 personal income tax revenues was $(7.5 million) and includes a $22.6 million decrease in the preliminary FY 2016 net accrual compared to final enacted. o The preliminary FY 2016 net accrual included an adjustment of $(12.17 million) to capture the impact of personal income tax law changes that took effect for tax years beginning on or after January 1, 2016 and $(9.27 million) to account for the delay in the processing of refunds for the period ending June 30, 2016. Preliminary FY 2016 personal income tax revenues were below final enacted FY 2016 estimates for both estimated payments and withholding tax payments by a combined total of $12.0 million or 0.9 percent. Preliminary FY 2016 sales and use tax revenues fell short of final enacted estimates by $9.1 million, or 0.9 percent. Preliminary FY 2016 lottery transfer revenues were 0.1 percent below the final enacted estimate of lottery transfer revenues of $370.1 million. Preliminary FY 2016 business corporations tax revenues were $18.6 million below the final enacted FY 2016 estimate due in large part to enhanced refunds processed in May and June 2016.

The FY 2016 Special Report on Preliminary Revenues shows that preliminary FY 2016 total general revenues exceeded audited FY 2015 revenues by $22.5 million or 0.6 percent. Preliminary FY 2016 total taxes and departmental receipts revenues were $38.9 million or 1.2 percent more than audited FY 2015 total taxes and departmental receipts revenues. Total tax revenues were $25.4 million, or 0.9 percent, more in preliminary FY 2016 than in audited FY 2015. Preliminary FY 2016 other general revenue sources were $16.4 million below audited FY 2015 other general revenue sources or 4.1 percent.

Regarding preliminary FY 2016 revenues and audited FY 2015 revenues, Director of Revenue Robert S. Hull made the following observations: Preliminary FY 2016 total general revenues were $22.5 million more than audited FY 2015 total general revenues, a significant decrease from the $210.4 million difference between preliminary FY 2015 total general revenues and audited FY 2014 total general revenues. The spread between preliminary FY 2016 and audited FY 2015 personal income tax revenues was $(10.2 million) and includes a $31.0 million decrease in the preliminary FY 2016 net accrual compared to audited FY 2015. Preliminary FY 2016 personal income tax final payments revenues were below audited FY 2015 personal income tax final payments revenues by $19.1 million or 9.4 percent while preliminary FY 2016 personal income tax withholding payments revenues were $27.0 million more than in audited FY 2015, a variance of 2.5 percent. Preliminary FY 2016 sales and use tax revenues were only $8.5 million more than in audited FY 2015 reflecting the elimination of the sales and use tax on energy sold to commercial users that went into effect on July 1, 2015. Preliminary FY 2016 lottery transfer revenues were $12.2 million below audited FY 2015 lottery transfer revenues. This difference includes the annual impact of the opening of a slots only gaming facility in nearby Massachusetts. Preliminary FY 2016 business corporations tax revenues were $13.1 million below audited FY 2015 revenues while preliminary FY 2016 estate and transfer tax revenues were $35.8 million more than in audited FY 2015.

The entire report can be found on the Department of Revenue's website, www.dor.ri,gov, under the Revenue Analysis header on the State Reports tab.

Questions or comments on the report should be directed to Paul Grimaldi, Chief of Information and Public Relations by e-mail at paul.grimaldi@revenue.ri.gov or by phone at (401) 574-8766.

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