Arkansas tax collections topped state projections in August, driven by strong growth in payroll withholdings and solid sales tax receipts, state finance officials said Wednesday.
Net available general revenue for the month reached $582.8 million, exceeding state budget forecasts by $4.5 million, or 0.8%, according to the Department of Finance and Administration. The monthly total represents a 2.5% increase compared to the same period last year.
Individual income tax collections totaled $268.5 million in August, up 2.1% from a year ago and $1.6 million above forecast. State officials attributed much of the gain to individual withholding tax revenue, which surged 11.8%—or $26.5 million—due in part to a calendar quirk providing an extra Friday payday during the month.
Sales and use tax collections, a primary indicator of consumer spending, rose to $327 million. That figure was $4.1 million higher than last year and $900,000 above monthly projections. High growth in the utilities and real estate rental sectors helped offset spending declines in construction and professional services.
Corporate income tax collections lagged behind expectations, generating $5 million for the month—down $500,000 from last year and $600,000 below forecast. Tobacco tax collections also fell to $14.2 million, which officials attributed to routine fluctuations in wholesale stamp purchases.
Through the first two months of the 2027 fiscal year, net available revenue stands at $1.18 billion, running $30.8 million, or 2.7%, ahead of forecast.
File image: John Sykes with Arkansas Advocate
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