About this time each month, Georgia releases the revenue figures from the previous month. The state’s two major revenue streams — individual income taxes and sales taxes — are also good barometers of the economy generally.
So today there’s this in the AJC: “State revenue collections spike in February”.
But that’s a horribly misleading headline, and even the data cited in the article itself is not as rosy as it is interpreted to be.
Regarding the huge year-over-year jump in personal income taxes:
Individual income tax collections, the state’s largest source of revenue, increased 106 percent in February to $185 million.
Deal’s office warned, however, that while there was significant growth, a large part of the increase is the result of an accounting change. The federal filing date for submitting an itemized individual return was pushed back two weeks to Feb. 15, which has resulted in a two-week shift in refunds.
And while sales tax revenues increased 10% according to the article, the truth is closer to 2%. Look at the raw data here. The state collects all the sales taxes, and then makes disbursements to the municipalities that levy portions of them. For years now, those distributions have been erratic — simply inconsistent with the month-to-month reality. So the gross sales tax collections (before the disbursements) are a better economic barometer. That number was $710 million in Feb. 2010 and $726 million in 2011. That’s definitely an improvement, and it’s true that the state did end up with 10% more year-over-year. But the raw data is hardly a sign of a strong recovery. In February 2008, the gross sales tax collection was $834 million, about 15% higher than this year’s figure.
We have a long way to go.