Knoxville — Tax collections in Tennessee were below the estimates for February.
A University of Tennessee economist said a sizable drop in franchise and excise tax collections led the way.
“On a year-to-year basis, combined franchise and excise taxes were down 45 percent for February, which is not very encouraging,” said Dr. Matt Murray. “But we need to put this in perspective. February is typically not a key month for franchise and excise tax collections.”
February tax collections were $476 million, an $8 million increase from the same time a year ago, but less than predicted.
Murray said sales tax collections were up slightly.
“Sales tax revenue was really quite anemic for the month, growing only 3.8 percent relative to February 1999,” Murray said. “That’s not an encouraging sign, but at least we have growth, and we have to look at things from a positive perspective.”
The Tennessee legislature may not finalize its state budget until it receives the April tax collection figures.