The latest state tax figures show that, for the second straight month, Idaho revenues lagged behind expectations in October. The state took in almost $186 million in taxes in October, but more than $190 million was expected. That means Gov. Butch Otter will have only one more month of economic numbers to refer to before he lays out the next Idaho state budget in January.
The Idaho Division of Financial Management’s latest report says the state general fund is $4.6 million ahead of projections for the fiscal year, that started in July, but sales tax receipts, which are supposed to be the biggest chunk of state tax dollars, have been lower than expected three months in a row. Personal income tax numbers were also down $2.2 million in October, but remain up $12 million since July.
In the report, the governor’s chief economist, Michael Ferguson, wrote that consumer spending and sales tax revenues are expected to stay down. “The rate of decline is diminishing, but just not fast enough,” Ferguson wrote. If that’s true, the FY2011 budget may well be less than the current budget of $2.3 billion.
Ferguson also wrote that while spending across the country should begin to increase starting next year, people will be more frugal than they were before the recession hit. His report said disposable income will likely rise more than spending, and that consumers won’t be as big a boost to the national economy as they were earlier this decade.
One surprise for the state is the slight increase in taxes from tobacco and alcohol. Those products have brought in $300,000 more than expected over the past four months.
For more, read Ferguson’s complete two-page state revenue summary and outlook (pdf) at the Idaho DFM website.