Memo: Kansas took in $16.4 million less in tax revenue in first half of fiscal year

Kansas took in $16.4 million less in tax revenue during the first six months of this fiscal year than it did the previous year.

The state general fund took in $2.79 billion in tax revenue from July through December, compared to almost $2.81 billion during the same period the year before, according to a memo released by the Kansas Legislative Research Department on Tuesday.

When other revenue sources are included, such as state agency earnings, the state general fund took in $22.5 million less than the year before, a drop of .8 percent.

Individual income tax revenue declined, although tax rates were the same both years.

The state took in $1.15 billion in individual income tax revenue during the first six months of last fiscal year, but saw that drop 4.4 percent to less that $1.1 billion for this fiscal year.

During both years, individual income tax rates were at 4.9 percent for the higher bracket and 3 percent for the lower bracket. Starting Jan. 1, those rates fell to 4.6 percent and 2.7 percent.

Tax revenues from gas and oil also dropped significantly. The gas tax generated about $250,000 less than last year, a 14.4 percent drop, and the oil tax generated about $260,000 less, a 6.1 percent drop.

The state revised its revenue estimates in November, making them less optimistic. But the state still fell short by $6.5 million, even after delaying a transfer to the Bioscience Development Fund, which helped boost the general fund by about $11.3 million.

The state faces a $279 million budget shortfall through June, the end of the fiscal year. Gov. Sam Brownback has proposed to fill the budget hole through a combination of cuts and sweeps from dedicated funds, most of which require approval of the Legislature.

Legislative Research hesitated to conclude what this data indicates long-term, noting in the memo that January might provide a better picture because it will include sales tax receipts on Christmas business. Estimated payments on individual income tax are due that month as well.

This story was originally published January 7, 2015 at 6:20 AM with the headline "Memo: Kansas took in $16.4 million less in tax revenue in first half of fiscal year."