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State cash collections up 9.1 percent through September

Providence, R.I. -- The Rhode Island Department of Revenue today released its FY 2019 Cash Collections Report for September 2018. The Cash Collections Report, which is issued on a monthly basis, compares current fiscal year cash collections by revenue item on a fiscal year-to-date and monthly basis to prior fiscal year cash collections by revenue item. The cash collections report makes no adjustments for the timeliness of the receipt of revenues and provides readers with insight into the state's cash flow over the course of the fiscal year.

Rhode Island Department of Revenue Director Mark A. Furcolo noted: "FY 2019 total general revenue cash collections through September are up 9.1 percent, or $91.7 million more than was received last fiscal year through September of 2017." The growth rate for FY 2019 through September is bolstered by the change in the estimated payments schedule for business taxpayers. Effective January 1, 2018, business taxpayers make estimated tax payments on a quarterly basis in April, June, September, and December. Prior to January 1, 2018, these payments were made twice a year in April and June with 100 percent of the taxpayer's expected tax liability due by June. The increase in FY 2019 total general revenues also includes the contemporaneous transfer of $32.3 million of lottery revenues which helps to offset the receipt of nearly $59.0 million in estate and transfer tax cash collections in July 2017, which did not reoccur in July 2018. FY 2019 personal income tax cash collections through September were $10.1 million more than in FY 2018 through September and FY 2019 through September sales and use tax cash collections were $17.9 million above the same period last fiscal year."

Notable cash collections items on a September fiscal year-to-date basis included: Total personal income tax cash collections of $333.4 million, up $10.1 million or 3.2 percent year-to-date. o Personal income tax withholding payments were down less than $1.0 million or 0.3 percent year-to-date, a decrease from the 4.2 percent fiscal year to date growth rate recorded in September 2017. o Personal income tax refunds and adjustments were down $4.9 million or 21.0 percent year-to-date, a substantively larger decrease than the 9.3 percent growth rate recorded in September 2017. Year-to-date September 2018 sales and use tax cash collections were up 6.4 percent in comparison to FY 2018 through September with total non-motor vehicle receipts $15.4 million more, meal and beverage receipts 3.6 percent more and motor vehicle sales and use tax receipts (i.e., Registry Receipts) $2.5 million more than the prior year. All other general revenue sources cash collections through September were up $7.8 million relative to last fiscal year at this time. This increase reflects sharply higher business corporation, public utilities gross earnings, financial institutions, insurance company gross premiums, and bank deposits tax cash collections as a result of the change in the estimated payment schedule for business taxes offsetting lower estate and transfer tax cash collections in September 2018 fiscal year-to-date. Fiscal year-to-date through September 2018 departmental receipts cash collections are $23.1 million, or 12.1 percent, more than in FY 2018 through September primarily due to increased FY 2018 hospital licensing fee payments received in July 2018 of $15.7 million. The lottery transfer in the new fiscal year reflects transfers of $95.8 million in FY 2019 through September. This transfer amount includes transfers from gaming activity in July and August 2018 as well as the contemporaneous transfer of September 2018 gaming receipts. In FY 2018 through September, only the cash generated by gaming activity in July and August 2017 was transferred in September.

Notable month of September cash collections items included: Increased September 2018 personal income tax cash collections of $9.2 million, 6.7 percent more than September 2017. o The increase in September 2018 personal income tax cash collections is largely attributable to increased estimated and withholding payments of $8.3 million, a variance of 6.1 percent. Increased September 2018 sales and use tax cash collections of $2.8 million or 3.0 percent from September 2017 with growth in sales and use taxes received from sales activity other than motor vehicle purchases of 4.5 percent including growth in sales tax receipts from meals and beverages prepared for immediate consumption of 10.7 percent. The September 2018 lottery transfer trailed the September 2017 lottery transfer by $209,052 million, or 0.7 percent. Increased all other general revenues cash collections for September 2018 of $60.2 million vs. September 2017 from the receipt of quarterly estimated business tax payments in September 2018 as a result of the change in the estimated payments schedule for business taxpayers. Higher departmental receipts cash collections of $2.8 million, a variance of 19.1 percent with this overage attributable to the receipt of approximately $1.0 million in September 2018 that should have been recorded in July and August of 2018.

The full cash collections report can be found on the Department of Revenue's web site, www.dor.ri,gov, under the Revenue Analysis directory or at this link: http://www.dor.ri.gov/revenue-analysis/2019.php under 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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