Georgia closed out fiscal 2022 last month with a massive budget surplus fueled by the significant increase in tax revenue. During the full fiscal year, which ended June 30th, the state brought in $33.09 billion in tax receipts, an increase of 23 percent over the fiscal 2021 year, as Georgia’s economy continued to rebound from the pandemic. In June, the state Department of Revenue collected $2.85 billion in taxes, an increase of 14.2 percent since June of last year.
Over the course of June, individual income taxes rose by 14 percent, with payments up by 6 percent and refunds down by 32 percent. Likewise, corporate income taxes rose by 47.2 percent, with both payments and refunds having risen substantially. Due to Governor Kemp’s decision to suspend collections of the state sales tax on gasoline, gas tax revenues plummeted by 99.5 percent last month.
As gas prices began rising in response to Russia’s invasion of Ukraine in February, by March the General Assembly made the decision to suspend collections of fuel taxes as they were approaching record highs. Governor Kemp has since extended the sales tax holiday twice, with the most recent extension set to expire in mid-August. Democratic gubernatorial candidate, Stacey Abrams, has continued to call on Kemp to extend the gas tax holiday through the end of the year, a move he could make without legislative approval as long as lawmakers later ratify the decision.
State officials originally planned to spend more than $54 billion in the just-ended budget year – this includes federal money, lottery proceeds, and other fees and taxes the state agencies collect. That number was later boosted by lawmakers by $4.5 billion during a mid-year budget revision that included bonus payments and pay raises for state employees and teachers. Currently, that number will still fall under the total revenue for the year. Final numbers won’t be clear until the state closes its books on the budget year, usually taking place around Labor Day.