State officials attribute this decline to changes in tax collection policies, particularly in individual income taxes, as well as a drop in revenue from motor vehicle tag fees and title fees.
Georgia experienced a decrease in net tax revenue of $205.7 million in May compared to the previous year, resulting in a 7.6% loss
Despite the decrease, a spokesperson for Governor Brian Kemp expressed confidence in the state’s economic stability, stating that the current numbers align with earlier predictions made by the governor and economic experts. The spokesperson emphasized the fiscally responsible and conservative approach taken by Governor Kemp and legislative partners, which has positioned Georgia to withstand potential future challenges, including a potential recession.
The analysis conducted by state officials revealed several key findings. Tax refunds issued saw a significant increase of 119.3%, while the amount withheld from Georgians’ paychecks rose by $80.9 million. Income tax return payments, on the other hand, experienced a substantial decline of 63.8% compared to the previous year. Non-resident income tax returns showed an increase of $11.7 million.
Regarding motor vehicle-related fees, there was a $0.4 million decrease in tag and title fees in May, along with a $2.3 million decrease in title ad valorem taxes
Although income tax collections and motor vehicle-related fees declined, sales and use tax, as well as corporate taxes, both witnessed significant growth of over 30% each.
Sales and use tax recorded an increase of $32.1 million, although there was also a notable rise of 93.6% in sales tax refunds compared to May 2022. Corporate taxes generated a total of $78.8 million in May, reflecting a substantial increase of 38.6%. Corporate tax refunds saw a decrease of nearly 50%, while corporate tax returns rose by 33.7%. Furthermore, payments across other tax categories for businesses in Georgia increased by $13.4 million.
Overall, Georgia’s tax revenue for May amounted to $2.49 billion, a decrease from the $2.7 billion collected in the same period the previous year.