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December 2018 cash collections report now available

Providence, R.I.,-- The Rhode Island Department of Revenue today released its FY 2019 Cash Collections Report for December 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 December are up 8.3 percent, or $154.0 million more than was received last fiscal year through December of 2017." Total general revenues are bolstered by $85.3 million in receipts due in large part to the change in the estimated payments schedule for business taxpayers. The increase in FY 2019 total general revenues also includes the contemporaneous transfer of $27.2 million of lottery revenues which helps to offset the receipt of nearly $67.2 million in estate and transfer tax cash collections in July and October 2017 which to date have reoccurred in much smaller amount(s) in FY 2019. FY 2019 personal income tax cash collections through December were $10.8 million less than in FY 2018 through December while FY 2019 through December sales and use tax cash collections were $33.0 million above the same period last fiscal year. It should be noted that sales and use tax cash collections through December generally correspond to taxable retail transactions made through November.

Notable cash collections items on a December fiscal year-to-date basis included: Total personal income tax cash collections of $665.5 million, down $10.8 million or 1.6 percent year-to-date. o Personal income tax withholding payments increased by $15.1 million or 2.6 percent year-to-date, a decrease from the 4.3 percent fiscal year to date growth rate recorded in December 2017. o Personal income tax estimated payments are down $24.8 million, or 22.8 percent year-to-date. Personal income tax estimated payments through December of FY 2018 were $17.3 million, or 18.9 percent, more than the same period in FY 2017. This increase was likely attributable to the Tax Cuts and Jobs Act's provision that caps the amount of state and local taxes than can be deducted on a taxpayer's federal income tax return beginning in tax year 2018. o Personal income tax refunds and adjustments are $5.8 million or 14.3 percent more than last fiscal year at this time when personal income tax refunds and adjustment were $8.2 million or 16.9 percent less than the prior year. Year-to-date December 2018 sales and use tax cash collections are up 6.1 percent in comparison to FY 2018 through December with total non-motor vehicle receipts $28.7 million more, meal and beverage receipts 0.3 percent less and motor vehicle sales and use tax receipts (i.e., Registry Receipts) $4.3 million more than the prior year. All other general revenue sources cash collections through December are up $60.7 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, motor vehicle registration and license fee, and cigarette and other tobacco products tax cash collections in December 2018 fiscal year-to-date. Fiscal year-to-date through December 2018 departmental receipts cash collections are $33.6 million, or 14.0 percent, more than in FY 2018 through December due in large part to increased FY 2018 hospital licensing fee payments received in July 2018 of $14.8 million. The lottery transfer in the new fiscal year reflects transfers of $189.3 million in FY 2019 through December. This transfer amount includes transfers from gaming activity in July through November 2018 as well as the contemporaneous transfer of December 2018 gaming receipts. In FY 2018 through December, only the cash generated by gaming activity in July through November 2017 was transferred in December.

Notable month of December cash collections items included: Decreased December 2018 personal income tax cash collections of $27.2 million, 17.2 percent less than December 2017. o The decrease in December 2018 personal income tax cash collections is largely attributable to decreased estimated payments of $29.0 million, or 66.7 percent. This decrease is almost the exact opposite of the increase in personal income tax estimated payments that occurred in December 2017 in response to the Tax Cuts and Jobs Act. o Increased refunds and adjustments of $3.8 million, or 106.8 percent, and decreased final payments of $1.2 million, or 22.9 percent also contribute to the shortfall in personal income tax cash collections. December 2017 final payments include $2.8 million from the 2017 Tax Amnesty program. o Personal income tax withholding payments showed minimal growth in December 2018 vs. December 2017, increasing by 6.0 percent or $6.7 million year-over-year. Increased December 2018 sales and use tax cash collections of $6.6 million or 8.1 percent from December 2017 with growth in sales and use taxes received from sales activity other than motor vehicle purchases of 8.5 percent including an increase in sales tax receipts from meals and beverages prepared for immediate consumption of 1.3 percent. December 2017 sales and use tax payments include $727,313 from the 2017 Tax Amnesty program. The December 2018 lottery transfer exceeded the December 2017 lottery transfer by $5.5 million, or 19.7 percent. Increased all other general revenues cash collections for December 2018 of $52.7 million vs. December 2017 with this increase generally attributable to the change in the estimated payments schedule for general business taxes, other than the health care provider assessment, to four quarterly payments effective January 1, 2018. Higher departmental receipts cash collections of $8.9 million, a variance of 63.9 percent, in December 2018 vs. December 2017; an increase due to the early receipt of $9.1 million in securities license fees that typically are received in January.

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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