The Department of the Treasury reported today that January revenue collections for the major taxes totaled $4.069 billion, up $27.4 million, or 0.7 percent above last January. Year-to-date, total collections of $17.957 billion for Fiscal Year 2020 (FY 2020) are up $1.014 billion, or 6.0 percent above the same period last year.
Gross Income Tax (GIT) receipts of $2.354 billion are 6.6 percent above last January. Year-to-date collections of $8.344 billion are up 6.0 percent. The GIT, which is constitutionally dedicated to the Property Tax Relief Fund, is the State’s largest tax revenue source.
The Sales and Use Tax, the largest General Fund revenue source, reported $1.105 billion in January, down 2.6 percent from last January. The decline is attributable to the boost received last January from Tax Amnesty collections. Year-to-date, sales tax collections of $5.392 billion are up 5.4 percent over last year.
The Corporation Business Tax (CBT), the second largest General Fund revenue source, generated $221.1 million, 19.3 percent below last January. Year-to-date, the CBT has collected $2.015 billion, up 11.3 percent above last year. As with the Sales and Use Tax, part of January’s net CBT decline is attributable to the Tax Amnesty boost last January. Also contributing to the decline was a 113.6 percent jump in refund payments, which followed on the heels of December’s 80.7 percent refund spike.
Treasury has cautioned in recent months about potential increases in CBT refunds. Nationally, tax analysts believe that some corporations have been overpaying taxes upfront while they continue to evaluate the implications flowing from the federal Tax Cut and Jobs Act. New Jersey has also made significant changes to its corporate tax policy in recent years, further complicating the predictability of tax planning behavior. Accordingly, corporations may continue filing for large refunds or begin reducing their tax payments in the coming months, once they have a better idea of their true tax liability.
The FY 2020 revenue forecast will be updated with the release of the Governor’s FY 2021 Budget Message on Tuesday, Feb. 25.