By GARRY RAYNO, InDepthNH.org
CONCORD — While the total state revenue for the first month of the new 2025 fiscal year is higher than estimates, the troubling trends of last fiscal year remain, indicating budget writers will face a challenging task next spring to craft a balanced budget.
State revenues for July were $126.7 million, which is $4.2 million above the plan for a balanced budget at the end of the biennium next June, and $8.6 million more than last fiscal year.
However, the same levies causing concern at the end of last fiscal year, business taxes, and the tobacco and real estate transfer taxes are all below estimates for the month, bailed out by two tax categories that will either go away or reduce what it produces in the near future.
Business taxes, the state’s single biggest source of money, were $4 million below estimates at $33.5 million, and $6.3 million less than what was produced a year ago.
According to the Department of Revenue Administration, “the decrease in Business Tax revenue from the prior year was due to a decrease in corporation and partnership estimates,” and $4.5 million more in refunds than a year ago at $8.4 million.
The tobacco tax produced $16.3 million in July, which is $3 million less than budget writers anticipated, and $400,000 less than a year ago.
The real estate transfer tax returned $19. 5 million in the first month of the new fiscal year, which is $2.2 million less than estimates, and $700,000 less than a year ago.
The communications and beer taxes also produced less than estimates for the month, as did Liquor Commission revenue.
The state’s second biggest source of revenue, the rooms and meals tax, produced $32.5 million during July, which is $2.6 million more than estimates and $1.9 million more than a year ago.
According to the DRA, the meals portion of the tax was up 6.6 percent over a year ago, and hotel stays were up 3.2 percent.
The “other” category produced $12.9 million in July, which is $10 million more than estimates, and $12 million more than a year ago.
Much of the surplus revenue comes from interest earned on federal COVID relief and recovery money and past state revenue surpluses.
The interest and dividends tax, which produced about 50 percent more revenue last fiscal year than anticipated, produced $1.1 million in July, which is over estimates by $700,000 for the month and $900,000 more than a year ago.
The tax is repealed beginning Jan. 1, 2025.
The insurance tax, securities revenue and court fines and fees were all over estimates for the month.
Highway Trust Fund and Fish and Game revenues were also more than anticipated for July.
The Highway Fund, largely comprised of the gas tax and auto registrations, produced $23 million for the month, which is $1.3 million more than estimates and $2.4 million more than a year ago.
The Fish and Game revenues — almost all from license fees — produced $2.3 million in July, a surplus of $200,000 for the month and for what was returned a year ago.
Garry Rayno may be reached at garry.rayno@yahoo.com.
