Gov. Northam announced last week that total general fund revenues rose 19.2 percent in December, the fifth straight month of double-digit revenue grown in the Commonwealth. Northam is leaving office with historic economic momentum, driven by solid growth in payroll withholding, corporate income tax, and sales and use taxes, according to a release.
“As I close out my term as Governor, I’m proud to be leaving the next administration with the strongest economy in Virginia history,” said Northam. “We have governed with fiscal responsibility and compassion for all Virginians—and with five straight months of double-digit revenue growth, record job creation and historic investments in Virginia families, the results speak for themselves. I look forward to this tremendous progress continuing in Virginia.”
On a fiscal year-to-date basis, total revenue collections rose 14.1 percent through December, ahead of the annual forecast of 4.2 percent growth. Collections of payroll withholding taxes rose 11.7 percent in December. Collections of sales and use taxes, reflecting November sales, rose 16.5 percent in December. November represents the beginning of the holiday shopping season.
“November represents the beginning of the holiday shopping season, and we will have a clearer assessment of holiday sales after receiving December sales tax payments due in January,” said Joe Flores, Secretary of Finance. “As our economic momentum continues, January nonwithholding payments will also give us a better indication of taxpayer behavior for calendar 2021 tax returns.”
December is a significant month for corporate income tax collections as quarterly estimated payments are due for most corporations and refunds from extension returns are processed. The corporate income tax increased 60.8 percent for the month totaling $410.2 million.
Fiscal-year-to-date, payroll withholding collections have grown 10.3 percent, ahead of the annual estimate of 5.9 percent growth. Collections of sales and use taxes have risen 14.8 percent, ahead of the annual estimate of 6.3 percent growth. For the first half of fiscal year 2022, non-withholding is essentially flat. Fiscal-year-to-date, the corporate income tax is up 57.3 percent, well ahead of the annual estimate of 13.6 percent. On a fiscal year-to-date basis, total revenue collections rose 14.1 percent through December, ahead of the annual forecast of 4.2 percent growth.