Iowa tax receipts post double-digit growth in May

DES MOINES - The Iowa treasury cashed in on its second-largest month for tax collections in state history in May.

Gross state tax receipts taken in last month totaled $969.7 million following the April 30 deadline for Iowans to pay their personal income taxes, according to a report issued Monday by the Legislative Services Agency. The net gain for state coffers was $874.5 million once refunds and other deductions were taken into account, said LSA senior tax analyst Jeff Robinson.

'It's a really good month. It's a strong month. Everything that needs to be good was good,” said Robinson, who noted the only month with higher state tax collections was May 2013, when concern over federal tax law changes resulted in nearly $1.023 billion in state tax receipts influenced by Iowa's federal deductibility law. That touched off a pendulum swing that resulted in a double-digit drop in May 2014 tax receipts.

With one month left in the fiscal year, net state receipts have totaled slightly more than $6.06 billion, a 6.1 percent increase that is outpacing fiscal 2014 collections by $350.4 million and was $39.2 million above the growth projection of 5.5 percent set by the Revenue Estimating Conference.

Robinson said it is likely actual tax receipts will top the REC's annualized estimate June 30 after May receipts topped the previous year by $118.5 million, or 15.7 percent. May personal income tax receipts totaled $521.6 million, a 21.7 percent increase that translated into $92.9 million and brought the year-to-date collections in that tax category to $228 million over the fiscal 2014 level through 11 months.

As predicted, receipts from farm income declined 'noticeably” this fiscal year because of depressed commodity prices and other factors, Robinson said, but the strength in wage withholdings and other tax categories more than offset the drop.

'There was a hit,” he said, but other sectors of Iowa's economy made up with strong, steady growth.

'The economy is still chugging along at a good rate. There aren't any negative signs at the moment,” Robinson said.