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Tennessee revenues for May were $1.645 billion, which is $52.4 million more than May of last year, but $29.5 million less than the budgeted estimate. The total growth rate for the month was 3.29 percent.

That’s according to an announcement from Finance and Administration Commissioner Jim Bryson earlier this week.

“Total tax revenues in May showed strong growth compared to the same time last year,” he said. “Sales tax collections, which reflect taxable sales activity in April, were lower than original estimates but still increased significantly from May 2023. Privilege tax receipts were solid, driven by gains in realty transfer and mortgage tax activity. However, we observed notable declines in motor fuel tax receipts and tobacco taxes, which impacted the overall growth for the month.

“Year-to-date, we are significantly below our original general fund budget estimate with two months remaining in the current fiscal year. However, with the support of the General Assembly, we passed a budget that reduced our current year’s general fund estimate and reset our recurring growth rate to zero percent year-over-year. As a result, we are on track to meet our revised estimated growth rates over the final two months of the fiscal year. In the meantime, we will continue to closely monitor tax collections and economic conditions to ensure fiscal stability.”

According to Bryson’s announcement, collections were as follows:

• Sales tax revenues were $18.4 million less than the estimate for May but were 3.36 percent more than May 2023. For 10 months, revenues are $124.1 million less than estimated. The year-to-date growth rate is 1.64 percent.
• Franchise and excise tax revenues combined were $11 million less than the budgeted estimate in May, but the growth rate compared to May 2023 was 0.96 percent. For 10 months, revenues are $313.6 million less than the estimate and the year-to-date growth rate is negative 7.02 percent.
• Gasoline and motor fuel revenues for May decreased by 5.95 percent compared to May 2023, but they were $1.3 million more than the budgeted estimate of $105.5 million. Through the first 10 months of FY2024, revenues are more than estimates by $6.2 million.
• Motor vehicle registration revenues were $5.3 million more than the May estimate, and on a year-to-date basis, revenues are $4.8 million more than the estimate.
• Tobacco tax revenues were $6.5 million less than the May budgeted estimate of $20.8 million. For 10 months, they are $20.6 million less than the budgeted estimate.
• Privilege tax revenues were $0.3 million more than the May estimate and increased 35.17 percent from May 2023. On a year-to-date basis, August through May, revenues are $112.8 million less than the estimate.
• Business tax revenues were $1.6 million more than the May estimate. For 10 months, revenues are $26.8 million more than the budgeted estimate.
• Mixed drink, or liquor-by-the-drink, taxes were $1.4 million less than the May estimate. For ten months, revenues are $1.6 million more than the budgeted estimate.

On April 18, 2024, in the second session of the 113th General Assembly, the Legislature passed House Bill 2973/Senate Bill 2942, which included the Funding Board’s revised revenue ranges for the current year. Upon passage, revenue estimates were revised lower by $798.4 million for total funds and $718.8 million for general fund revenue. The appropriations bill, Public Chapter 966, was signed by Governor Lee on May 15, 2024.

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