State of Tennessee Revenues Report for September 2023

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October 16, 2023 – Tennessee revenues for September totaled more than the state collected In September of 2022, but less than the budgeted estimates. Finance and Administration Commissioner Jim Bryson today reported that September tax revenues were $2.2 billion, which is $29.4 million more than September of last year, but $7.4 million less than the budgeted estimate. The total growth rate for the month was 1.37 percent.

“September sales tax receipts remained strong, with notable growth from online retail sales, motor vehicle sales, apparel and clothing sales, and restaurant activity,” Bryson said. “Food store sales tax revenues for September, the first of a three- month food sales tax holiday, were level with collections from the same period last year, when there was also a food tax holiday. Franchise and excise taxes, privilege taxes and motor vehicle registration fees underperformed for the month while the state’s gross receipts tax had a large one-time tax payment that increased its growth.

“We’re encouraged to see consumer activity continuing to hold strong and will continue to closely monitor state finances especially in a few months when holiday shopping begins.”

On an accrual basis, September is the second month in the 2023-2024 fiscal year.

For September, general fund revenues were less than the budgeted estimates in the amount of $9 million, and the four other funds that share in state tax revenues were more than the budgeted estimate by $1.6 million.

Sales tax revenues were $26.2 million more than the estimate for September. The September growth rate was 2.95 percent. Year-to-date revenues are 3.06 percent more than this time last year.

Franchise and excise taxes combined were $36.2 million less than the September budgeted estimate of $792.7 million. The September growth rate was negative 2.47 percent, and the year-to-date corporate tax growth rate is negative 6.78 percent.

Gasoline and motor fuel revenues for September increased by 9.34 percent and were $6.9 million more than the budgeted estimate of $109.5 million.

Motor Vehicle Registration revenues were $8.5 million less than the September estimate, and on a year-to-date basis are less than the estimate by $11.5 million.

Tobacco tax revenues for the month were $0.7 million less than the budgeted estimate of $19.9 million. For two months, revenues are $3.1 million less than the budgeted estimate.

Privilege tax revenues were $11.8 million less than the budgeted estimate of $48.1 million, and on a year-to-date basis are less than estimate by $25.1 million.

Gross receipts tax revenues were $14.6 million more than the September estimate, and on a year-to-date basis are $14.3 million more than estimates.

Business tax receipts were $0.8 million more than the budgeted estimate for September. For two months, revenues are near level with the budgeted estimate.

Mixed drink, or liquor-by-the-drink, taxes were $0.6 million more than the September estimate, and on a year-to-date basis, revenues are $1.2 million more than the estimate.

All other taxes were more than estimates by a net of $0.7 million.

Year-to date revenues for the first two months of the fiscal year were $46.9 million less than the budgeted estimates. The general fund is less than estimates by $53.1 million and the four other funds that share in state tax revenues exceeded estimates by $6.2 million.

The budgeted revenue estimates for 2023-2024 are based upon the State Funding Board’s consensus recommendation from November 28, 2022 and adopted by the first session of the 113th General Assembly in April 2023. Also incorporated in the estimates are any changes in revenue enacted during the 2023 session of the General Assembly. These estimates are available on the state’s website at https://www.tn.gov/content/tn/finance/fa/fa-budget-information/fa-budget-rev.html.

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