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June 2018 Revenue Assessment Report now available

Providence, R.I. -- The Rhode Island Department of Revenue today released its FY 2018 Special Report on Preliminary Revenues. This report provides a detailed look at FY 2018 preliminary revenues as provided in the Controller's Preliminary General Fund Revenue Report for FY 2018 and compares these revenues to both the final enacted FY 2018 revenue estimates and the audited FY 2017 revenues as provided in the Final General Fund Revenue Report for FY 2017. 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 2018.

The FY 2018 Special Report on Preliminary Revenues shows that preliminary FY 2018 total general revenues lagged the final enacted FY 2018 revenue estimates by $4.0 million or 0.1 percent. Preliminary FY 2018 total taxes and departmental receipts revenues finished behind the final enacted FY 2018 total taxes and departmental receipts revenues by $2.9 million or 0.1 percent. The largest portion of this difference is attributable to total taxes which were $2.5 million, or 0.1 percent, less in preliminary FY 2018 revenues than the final enacted FY 2018 revenue estimates. Preliminary FY 2018 other general revenue sources were $1.0 million, or 0.2 percent, below the final enacted FY 2018 revenue estimate of other general revenue sources.

Regarding preliminary FY 2018 revenues and final enacted FY 2018 revenue estimates, Director of Revenue Mark A. Furcolo made the following observations: Preliminary FY 2018 total general revenues were $4.0 million less than final enacted FY 2018 total general revenues. This shortfall was due in large part to personal income tax revenues which underperformed estimates by nearly $12.0 million. Strong sales and use tax revenues relative to the final enacted estimate helped to offset nearly half of the shortfall in actual personal income tax revenues. The spread between preliminary FY 2018 and final enacted FY 2018 personal income tax revenues was $(11.9 million), due primarily to weaker than expected personal income tax estimated payments revenues and stronger than expected personal income tax refunds and adjustments revenues. Preliminary FY 2018 personal income tax revenues were above final enacted FY 2018 estimates for both final payments and withholding tax payments by a combined total of $4.7 million or 0.3 percent. Preliminary FY 2018 sales and use tax revenues exceeded final enacted estimates by $5.3 million, or 0.5 percent. Preliminary FY 2018 lottery transfer revenues were 0.1 percent above the final enacted estimate of lottery transfer revenues of $364.6 million. Preliminary FY 2018 public utilities gross earnings tax, financial institutions tax, and cigarettes tax revenues were a combined $20.8 million above the final enacted FY 2018 estimates for these revenue items while preliminary FY 2018 business corporation tax and insurance company gross premiums tax revenues were a combined $13.6 million below the FY 2018 final enacted revenue estimate.

The FY 2018 Special Report on Preliminary Revenues shows that preliminary FY 2018 total general revenues exceeded audited FY 2017 total general revenues by a whopping $222.1 million or 6.0 percent. Preliminary FY 2018 total taxes and departmental receipts revenues were a substantial $196.7 million or 6.0 percent more than audited FY 2017 total taxes and departmental receipts revenues. Total tax revenues were $170.7 million, or 5.8 percent, more in preliminary FY 2018 than in audited FY 2017. Preliminary FY 2018 other general revenue sources were $25.4 million above audited FY 2017 other general revenue sources or 6.6 percent.

Regarding preliminary FY 2018 revenues and audited FY 2017 revenues, Director of Revenue Mark A. Furcolo made the following observations: Preliminary FY 2018 total general revenues were $222.1 million more than audited FY 2017 total general revenues, the largest nominal difference between current fiscal year preliminary total general revenues and prior fiscal year audited general revenues since FY 2005. The spread between preliminary FY 2018 and audited FY 2017 personal income tax revenues was $101.5 million, the largest spread between current fiscal year preliminary personal income tax revenues and prior fiscal year audited personal income tax revenues since FY 2015. All personal income tax components, except refunds and adjustments, for preliminary FY 2018 outperformed audited FY 2017 personal income tax revenues with withholding payments $52.1 million more, final payments $29.8 million more and estimated payments $27.8 million more than in audited FY 2017. Preliminary FY 2018 personal income tax refunds and adjustments revenues were $13.2 million greater than in audited FY 2017, an increase of 4.1 percent. Preliminary FY 2018 sales and use tax revenues were $58.6 million more than in audited FY 2017, the largest nominal difference between current fiscal year preliminary sales and use tax revenues and prior fiscal year audited sales and use tax revenues since FY 2001. Preliminary FY 2018 lottery transfer revenues were $2.3 million above audited FY 2017 lottery transfer revenues, the first year-over-year increase since FY 2015. Preliminary FY 2018 estate and transfer tax revenues were $34.0 million below audited FY 2017 estate and transfer tax revenues because of the receipt of large payment(s) in July 2017 that were accrued back to FY 2017. Although large estate and transfer tax payment(s) were received in preliminary FY 2018, these payments were significantly less than the large payment(s) that were recorded in audited FY 2017.

The entire report can be found on the Department of Revenue's web site, 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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