For the second year in a row, Georgia tax collections were up from the previous fiscal year.
And while that in itself is a positive, as are the eight consecutive quarters of year-over-year growth, the 4.8 percent rate of tax collections growth in Fiscal Year 2012 was not as strong as it was in FY 2011, when overall collections rose 8 percent compared to FY 2010.
Net revenue collections, according to figures released Friday by Gov. Nathan Deal's office, were $16.05 billion, up $742 million from FY 2011. The governor's office said the final month of the fiscal year -- June -- ended up being weaker than expected at $1.54 billion, a 2.6 percent increase from June 2011.
For the year, individual income taxes were at more than $8.1 billion, up 6.3 percent from FY 2011, while general sales and use taxes were up 4.6 percent to more than $5.3 billion. Prepaid motor fuel taxes were up 19.4 percent, while motor fuel excise tax dropped 2.2 percent for a net increase in motor fuel taxes of 9.1 percent, topping the $1 billion mark.
Those revenue increases are encouraging, but two numbers that are concerning were the 12.1 percent decrease in corporate income taxes, down to $590 million for the year from FY 2011's $671 million, and an 11.6 percent drop in property taxes, from $76.2 million in FY 2011 to $67.4 million in FY 2012. Those numbers both showed year-to-year improvements for the month of June, however, with corporate income tax collections up 38.7 percent in June 2012 compared to June 2011 and property taxes showing a 21.7 percent year-to-year increase for the month. Motor vehicle tag, title and fees were also up year to year 13.7 percent for the month of June, well ahead of the FY 2012 increase of 4.3 percent over FY 2011 for those fees and taxes.
Given the circumstances over the past few years, an overall revenue collections bump of 4.8 percent is nothing to dismiss, though we are still far away from the pre-recession days when the state budget contained more than $21 billion in annual spending.
One of the fortunate things we have in Georgia is the requirement that our state budget be balanced at the end of each fiscal year. While this requires more disciplined spending, our state, which has been affected like the other 49 by the recession and sluggish recovery, hasn't run into the problems that states who follow the federal government's example of deficit spending have faced.
Balanced budgeting requires lawmakers to make hard decisions on spending and forces them to demonstrate responsibility -- two things that will pay off for the state in the long run.