Politics & Government

Kansas misses August revenue estimates by about $10 million

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Kansas missed revenue estimates for August by more than $10 million.

The state fell 2.3 percent below estimates for the month overall.

It was the fourth straight month that Kansas has failed to hit its revenue projections. Tax collections have fallen short 10 of the past 12 months.

Republican Gov. Sam Brownback has pointed to a soft economy even as his critics make his tax-cutting policies a key issue in this year’s elections.

Kansas has struggled to balance its budget since GOP legislators heeded Brownback’s call to slash personal income taxes in 2012 and 2013 as an economic stimulus. On Thursday, an economist with the Washington-based Tax Foundation told Mississippi lawmakers evaluating planned tax cuts that Kansas is “an example of what not to do in tax reform.”

But individual income tax revenue surpassed estimates by $14.8 million, or 9 percent, for the month.

“Individual income taxes beat estimates for the second month of the fiscal year, which is encouraging, but corporate, sale and use tax receipts continue to lag pulling down the overall totals,” Secretary of Revenue Nick Jordan said in a statement.

The state had expected to bring in $10 million in corporate income tax revenue for the month, but took in less than $304,000, a miss of nearly 97 percent.

Jeannine Koranda, a spokeswoman for the Kansas Department of Revenue, said in a phone call that “this appears to be more of an ongoing thing nationally that corporate is down.”

Koranda cited a report from the Washington-based publication The Hill that 31 of the 45 states that have a corporate income tax are expecting revenue declines in the future.

Sales tax revenue was off by $14.1 million, or 6.9 percent.

The Department of Revenue attributed the miss in sales tax receipts partly to the state’s slumping agricultural and oil industries.

The state has collected about $852 million in taxes since the start of the new fiscal year in July, which is about 2.6 percent below estimates.

Brownback noted during a news conference Wednesday that the state has increased some taxes and trimmed spending since the big personal income tax cuts. It boosted sales and cigarette taxes last year to close budget gaps, but the governor said it still faced “great difficulties in a couple of the major pieces” of its economy.

“You’ve got to have an economy that’s growing,” he told reporters. “And almost any state in the country and nation in the world that has a strong commodity base to it has been struggling lately.”

Contributing: Bryan Lowry of The Eagle; John Hanna and Emily Wagster Pettus of the Associated Press

Bryan Lowry: 785-296-3006, @BryanLowry3

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