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July 2021 Revenue Assessment report available

Providence, R.I. -- The Rhode Island Department of Revenue (DOR) today released its FY 2022 Revenue Assessment Report for July 2021. The Revenue Assessment Report, which is issued on a monthly basis, compares the adjusted general revenues by revenue source on a fiscal year-to-date and monthly basis to expected general revenues by revenue source. Expected general revenues are estimated by the DOR's Office of Revenue Analysis from the revenue estimates included in the FY 2022 enacted budget signed into law on July 6, 2021 by Governor McKee. The methodology underlying the Office of Revenue Analysis' estimates is contained in Section II. of the report.

July Year-To-Date Performance: On a fiscal year-to-date basis, the July 2021 report shows that adjusted total general revenues are ahead of expected total general revenues, based on the enacted FY 2022 revenue estimates included in the enacted budget and the Office of Revenue Analysis' estimation methodology, with adjusted total general revenues $22.1 million more than expected total general revenues, a variance of 8.4%. The strongest driver of this outperformance are excise tax revenues which are up $16.2 million, or 12.3%, over expectations. General business tax adjusted revenues are $9.4 million ahead of the estimate, or 90.8%. Adjusted personal income tax revenues for the fiscal year-to-date through July are $1.1 million less than expected a variance of 1.1% while combined other tax and departmental receipts adjusted revenues are $2.5 million below expectations, or 12.5% on a fiscal year-to-date basis.

Regarding July year-to-date performance, Director of Revenue Guillermo L. Tello made the following observations: Fiscal year-to-date adjusted total general revenues through July are $221 million ahead of expectations based on the enacted estimates included in the FY 2022 budget signed into law on July 6, 2021, a variance of 8.4%. FY 2022 year-to-date adjusted sales and use tax revenues through July exceed expectations by $15 million, or 13.0% likely a reflection of the increased spending capability of consumers as the state's economy operates with no COVID-19 pandemic induced restrictions. Adjusted business corporation tax revenues through July are $10.9 million above the estimate, a variance of 205.5% and could include some estimated payments made by C-corporations in anticipation of an increased TY 2021 tax liability associated with the taxation of Paycheck Protection Program (PPP) loan forgiveness of more than $250,000. Fiscal year-to-date through July cigarette and other tobacco products excise tax revenues are $1.2 million more than estimated, a variance of 8.4%, which continues the trend that was established in FY 2021 as the ban on the sale of flavored tobacco and cigarettes took hold in Massachusetts. Adjusted personal income tax revenues through July are $1.1 million below the estimate, a variance of 1.1%, due to withholding payments $6.8 million less than expected, or 6.6%, offset by estimated payments of $1.9 million (35.9%), final payments of $2.5 million (68.8%) and refunds and adjustments of $1.2 million ( 12.5%) better than their respective estimates. FY 2022 year-to-date departmental receipts adjusted revenues trail the estimate by $2.3 million, a difference of 16.9%.

July Monthly Performance. Given that July is the first month of the fiscal year, the assessment of revenues on a fiscal year-to-date and a monthly basis are the same.

The entire report can be found on the Department of Revenue's web site at http://www.dor.ri.gov/revenue-analysis/2021.php.

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) 378-1080.

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