Kansas tax revenue falling short of expectations
TOPEKA (AP) — Kansas collected slightly less than expected in taxes during the first quarter of its fiscal year, but state Department of Revenue officials said Monday the shortfall may be a positive economic sign.
The department reported the state collected $1.37 billion in taxes from July through September, about $8.5 million below expectations. The shortfall is about 0.6 percent.
But corporate income tax collections during those three months fell nearly 12 percent short of projections. The state had expected to take in $97 million and instead collected less than $86 million.
The department is still assessing the shortfall and will have a better sense of what happened after October, spokeswoman Jeanine Koranda said. But, she added, the department believes corporate income tax revenues may have flagged because businesses were investing more than expected in machinery.
A 2011 law boosted the income tax breaks available to businesses buying machinery, and Koranda said the shortfall in collections could signal that firms are willing to make such investments.
Revenue Secretary Nick Jordan said in a statement: "We believe that all of these numbers show that Kansas businesses are investing and citizens are spending more money."
Individual income tax collections also were slightly below projections for the past three months. The state expected to take in $580 million but collected less than $575 million, a difference of about $5.2 million, or 0.9 percent.
Projecting individual income tax revenues became trickier this year because the Republican-dominated Legislature enacted aggressive personal income tax cuts at GOP Gov. Sam Brownback's urging.
During the first three months of the state's previous fiscal year, it collected $710 million in individual income taxes, or about 19 percent more than in the first quarter of the current fiscal year.