Tourism helps state revenues top expectations

TALLAHASSEE — Florida’s monthly revenues continue to
top expectations, aided recently by an increase in tourism-industry tax
collections, a new report from state economists shows.

The Legislature’s Office of Economic & Demographic
Research on Tuesday reported May general-revenue collections came in at
$3.6 billion, topping a forecast for the month by $573.8 million, or 18.9
percent.

“Most remarkable, almost 72 percent of the total gain
for May came from sales tax GR (general revenue),” the report said. “For
context, May 2020 was the lowest sales tax collection month during the
entire pandemic.”

The May 2021 collections reflected business activity
that mostly occurred in April, a period that economists said benefited from
people receiving federal stimulus checks. Other factors for the increase
included “redirected spending from the hard-hit service sector and some
consumers’ ability to draw down atypically large savings that built up
during the pandemic,” the report said.

The May numbers marked the 10th consecutive month of
exceeding revenue expectations as Florida recovers from the economic
fallout of the COVID-19 pandemic.

Economists periodically update revenue forecasts, with
the May figures measured against a forecast revised in early April. The May
numbers came after revenue topped forecasts for April by $797.2 million,
March by $299.6 million, February by $298.5 million, and January by $246.7
million.

Sales taxes make up the largest portion of state general
revenue, which is used to fund programs such as schools, health care and
prisons.

May revenue figures topped expectations in six sales-tax
categories watched by economists, including tourism, which has been hit
hard during the pandemic.

Taxes collected from tourism in May exceeded the
forecast by 21 percent, according to the monthly report. For April, taxes
from tourism topped the forecast amount by 12.1 percent. 

The tourism industry saw improvement during the first
three months of 2021, but the number of visitors was still down 14 percent
from a year earlier, when the state started to grapple with the pandemic.

Second-quarter tourism numbers have not been released,
but officials say Florida is better positioned for a recovery because of
reopening efforts that started last summer, ahead of many other large
states.

Meanwhile, tax collections on consumer non-durable items
were up 13.2 percent in May from the forecast, while collections on
automobiles were up 40.6 percent.

Collections were also above forecast in most other types
of taxes that go into general revenue, including corporate-income taxes,
documentary-stamp taxes and beverage taxes, according to the report.

Among revenue sources failing to meet expectations were
insurance taxes and tobacco taxes.