Minnesota Management and Budget released its midyear revenue and economic update Monday and almost all of the state's estimated net receipts for fiscal year 2017 are slightly below what was predicted in last February's forecast.
However, income tax withholding, estimated payments and net general sales tax receipts were estimated to end the fiscal year above the forecast, the agency said.
The Minnesota state budget operates on a two-year cycle, or biennium, covering two fiscal years. A fiscal year begins July 1 and ends June 30 of the following year.
The state's net general fund receipts are now estimated at $20.95 billion, $104 million, or 0.5 percent, less than projected, although general fund revenue is estimated to be 0.3 percent higher than in fiscal year 2016.
Net individual income-tax receipts are estimated to end the year $260 million (2.3 percent) less than forecast, while gross income-tax receipts were $142 million below forecast and refunds were $118 million larger than expected.
In addition, non-wage income — particularly capital gains — may have grown more slowly in 2016 than had been forecast, the agency said. The Congressional Budget Office has speculated that weak federal income tax payments for 2016 may be due in part to taxpayers shifting payments from 2016 into later years in anticipation of federal tax rate cuts under President Donald Trump.
Net general sales tax receipts are estimated to end the fiscal year $13 million (0.2 percent) above what was forecast. Lower than expected sales tax refunds more than offset gross tax payments that were below the forecast.
Net corporate receipts were $59 million (5.2 percent) more than projected. Other revenue also exceeded the forecast by $84 million (2.5 percent).
The full July 2017 revenue and economic update can be found on the Minnesota Management and Budget website at http://bit.ly/2u6N8ii