Providence, R.I. — The Rhode Island Department of Revenue (DOR) today released its FY 2021 Revenue Assessment Report for August 2020. The Revenue Assessment Report, which is issued on a monthly basis, compares the adjusted general revenues by revenue source on a fiscal year-to-date and monthly basis to expected general revenues by revenue source. Expected general revenues are estimated by the DOR’s Office of Revenue Analysis from the revised FY 2021 revenue estimates adopted at the May 2020 Revenue Estimating Conference (REC). The methodology underlying the Office of Revenue Analysis’ estimates is contained in the report.

August Year-To-Date Performance.
On a fiscal year-to-date basis, the August 2020 report shows that adjusted total general revenues are ahead of expected total general revenues, based on the revised FY 2021 revenue estimates adopted at the May 2020 REC and the Office of Revenue Analysis’ estimation methodology, with adjusted total general revenues $62.8 million more than expected total general revenues, a variance of 12.8%. The strongest driver of this outperformance are excise tax revenues, which are up $33.4 million, or 14.5%, over expectations. Adjusted personal income tax revenues for the fiscal year-to-date through August are $17.0 million more than expected, a variance of 9.1%. General business tax adjusted revenues are $7.8 million ahead of the estimate, or 50.5%, while combined other tax and departmental receipts adjusted revenues are $4.1 million over expectations, or 11.6% on a fiscal year-to-date basis. Finally, the lottery transfer through August is $570,595 more than expected, a 2.6% difference.

Regarding August year-to-date performance, Director of Revenue Mark A. Furcolo made the following observations:
Fiscal year-to-date adjusted total general revenues through August are $62.8 million ahead of expectations based on the FY 2021 revised estimates adopted at the May 2020 REC, a variance of 12.8%.
• FY 2021 year-to-date adjusted sales and use tax revenues through August exceed expectations by $27.6 million, or 13.6%, likely a reflection of the increased spending capability of consumers as a result of the $600 per week enhanced unemployment benefits and the federal COVID-19 relief payments. Fiscal year-to-date through August sales and use tax revenues reflect June and July 2020 sales activity.
• Adjusted personal income tax revenues through August are $17.0 million above the estimate, a variance of 9.1%, led by strong personal income tax withholding payment revenues, which may have benefitted from the $600 per week enhanced unemployment benefits received in July 2020 and the increased phased reopening of the state’s economy. The outperformance of personal income tax withholding revenues was supported by solid gains relative to expectations in both personal income tax estimated and final payments revenues, which on a combined basis were $7.3 million above the estimate, a difference of 48.6%.
• Adjusted insurance company gross premiums tax revenues were above expectations by $6.3 million in FY 2021 year-to- date and estate and transfer tax adjusted revenues ahead of the estimate by $4.1 million or 61.4% on a fiscal year-to-date basis through August.
• Fiscal year-to-date through August cigarette and other tobacco products excise tax revenues are $5.7 million more than estimated, a variance of 24.4%, with this gain possibly due to the banning of flavored tobacco and cigarettes in Massachusetts effective June 1, 2020; and

August Monthly Performance.
For the month of August, the August 2020 report shows that adjusted total general revenues are ahead of expected total general revenues, based on the revised FY 2021 revenue estimates adopted at the May 2020 REC and the Office of Revenue Analysis’ estimation methodology, with adjusted total general revenues $25.5 million more than expected total general revenues, a variance of 9.7%. The strongest driver of this outperformance are excise tax revenues, which are up $14.7 million, or 12.6%, over expectations. General business tax adjusted revenues are $4.6 million ahead of the estimate, or 64.4% while adjusted personal income tax revenues for August are $4.0 million more than expected, a variance of 4.1%. Combined other tax and departmental receipts adjusted revenues are $1.6 million over expectations, or 8.7% on a monthly basis. Finally, since August is the first month for the lottery transfer, there is no difference between the fiscal year-to-date and monthly performance for this revenue item.

Regarding August monthly performance, Director of Revenue Mark A. Furcolo made the following observations:
• August adjusted total general revenues through are $25.5 million ahead of expectations based on the FY 2021 revised estimates adopted at the May 2020 REC, a variance of 9.7%.
• Adjusted sales and use tax revenues for August exceed expectations by $13.7 million, or 13.4% likely a reflection of the increased spending capability of consumers as a result of the $600 per week enhanced unemployment benefits and the federal COVID-19 relief payments. August sales and use tax revenues reflect July sales activity.
• Adjusted insurance company gross premiums tax revenues for August were above expectations by $4.8 million in FY 2021.
• August adjusted personal income tax revenues are $4.1 million above the estimate, a variance of 4.1%, led by personal income tax withholding and final payments revenues, which are a combined $5.8 million above the estimate for August, a variance of 5.8%. The outperformance of personal income tax withholding and final payments revenues was supported by personal income tax estimated payments, which were $1.6 million more than the estimate while personal income tax refunds and adjustments revenues were greater than the estimate by 50.1% or $3.3 million.
• Estate and transfer tax adjusted revenues for August were ahead of the estimate by $2.9 million or 84.4%.

The entire report can be found on the Department of Revenue’s website at http://www.dor.ri.gov/revenue-analysis/2021.php.

Questions or comments on the report should be directed to Paul Grimaldi, Chief of Information and Public Relations by e-mail at paul.grimaldi@revenue.ri.gov or by phone at (401) 378-1080.

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