In another sign that Georgia’s economy is going strong, state tax collections were up 10 percent in January, making it more likely there will be a big surplus when the fiscal year ends June 30.
Excluding increases in gas taxes approved by lawmakers during last year’s General Assembly session, collections improved 6.4 percent in January over January 2015, Gov. Nathan Deal announced Monday.
For the first seven months of the fiscal year, collections jumped 8.9 percent, or about $1 billion, from fiscal 2015.
While the gas tax hike played a significant role in the increases in January, individual income tax collections were also up 7.9 percent and net sales taxes were up 2.4 percent. State government gets most of its money from those two taxes.
Deal is counting on a surplus at the end of the fiscal year because he wants to leave office in January 2019 with $2 billion in the state’s savings account. The state had $1.43 billion in reserves as of the end of fiscal 2015, last June 30. The state had closer to $100 million in reserves during the Great Recession.
The good news on the revenue front may prompt some lawmakers to push for tax cuts during the 2016 session, but much of the increase is already spoken for.
Besides putting more money into reserves, Deal and lawmakers plan to spend $700 million to $800 million more on transportation projects, as they promised they would when they approved gas and hotel tax increases last year.
The Georgia Senate’s budget committee approved a midyear budget plan Monday that included $1 billion in extra spending, almost all of it for roads and education programs. The full Senate is expected to vote on it later this week.
The House has already passed its version of the midyear budget, which runs through June 30. The versions passed by the two chambers have a few, minor differences, and they almost mirror what Deal presented to the General Assembly in January.
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