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Economy

Kansas Tax Collections Lower Than Expected In December

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Ervins Strauhmanis, flickr Creative Commons
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Kansas collected $27 million less than expected in taxes last month, largely driven by sagging income and sales tax receipts. The drop is enough to erase the state’s small estimated savings account.

Kansas Secretary of Revenue Nick Jordan says it’s too early to tell if it’s a one-time drop in income taxes or a trend.

“It is the first time this fiscal year that individual income tax receipts have not grown compared to the prior fiscal year to date,” Jordan says.

Unless the coming months beat projections, Kansas will again be in a budget deficit for the current fiscal year. Democratic state Sen. Anthony Hensley believes lawmakers will have to amend the current year’s budget.

“The question now is by how much? I don’t anticipate January, February and March are going to be positive months. I think we’re going to see more of the same,” Hensley says.

Republican House Speaker Ray Merrick blames the national economy and President Obama’s fiscal policies for the drop in state sales tax collections.

“When the going gets tough, Kansas families pore over their household budgets. That is why I am committed to an in-depth review of the state budget to ensure each tax dollar is being spent as effectively as possible," Merrick says.

The shortfall adds to the projected deficit for the next fiscal year, which could approach $200 million.

Kansas tax collections fell short of expectations in December by $27 million.

In a statement, Secretary of Revenue Nick Jordan says this is the first time individual income taxes missed the mark this fiscal year. He says it’s too early to tell if this is just a one-month blip or a trend. Sales taxes also came in lower than expected.

The shortfall is more than enough to eliminate the small savings account state officials had projected. Democratic state Sen. Anthony Hensley says that means more work for lawmakers when the 2016 session kicks off next week.

“We’re still in a budget crisis that we’re going to have to deal with this next legislative session,” Hensley says.

If tax collections in the coming months beat expectations, that also could erase the budget deficit.