- Florida tax receipts brought in nearly $4.27 billion in May, beating forecasts by 21%
- Consumer non-durables and tourism sales tax accounted for the highest dollar amount at $159.3 million and $157.9 million, respectively
- Economists fear inflation will affect how Floridians use discretionary spending
- DeSantis touts inflation preparedness in state budget
Tax receipts for the month of May once again beat expectations, beating projections by 21%. The state brought in just under $4.27 billion in general revenue in May, with sales tax accounting for nearly 79% of the total, according to a report published by the Florida Office of Economic and Demographic Research.
Several sales tax categories contributed to the higher-than-expected totals, including consumer consumables, made up of items purchased for immediate use like food, gasoline and clothing, bringing in $159.3 million. dollars more than the estimate. Tourism taxes provided another significant boost, gaining $157.9 million, or 26% from forecast month over month. Other positive revenues include automobile tax, insurance taxes and company filing fees.
“After hitting a record high of 33.7% in April 2020, compared to 7.9% for the whole of fiscal year 2018-2019, the most recent data on personal income indicated that personal savings are remained relatively stable, albeit subdued, since March, posting 5.4 percent in May,” the financial report said. “Also noteworthy is that the consumer price index for the all items index rose 8.6% for the 12 months ending in May, which is higher than the figure of 8.3% for the period ending in April. The immediate response to inflation is an increase in sales tax collections that reflects rising prices”
Monthly revenues have repeatedly exceeded forecasts. In the first four months of 2022, collections exceeded expectations by $2.125 billion.
Despite the positive economic trends, experts predict that the continued rise in inflation rates could affect how Floridians spend money. Across the state, residents have seen soaring prices for food, housing and gasoline, leading some to retreat from discretionary spending.
“Persistent inflationary conditions, however, eventually suppress collections as consumers begin to spend more money on non-taxable necessities like food and health care. In this regard, home food prices rose 11.9% in May, the largest 12-month percentage increase since the period ending April 1979,” the report said.
Govt. Ron DeSantis addressed the issue of inflated inflation, saying he feared a recession was on the horizon.
“I am, quite frankly, concerned and worried that Biden is pushing us into a recession,” DeSantis said at a recent press conference. “If you look at what he did when he came in, he decided to print trillions and trillions of dollars, and the result was the worst inflation we’ve seen in this country in four decades. It’s killing people at all levels to have to pay so much for gas, to pay so much for bills and to pay so much for food.
In total, three-quarters of Floridians are “somewhat” or “very dissatisfied” with the federal government’s handling of inflation and rising costs of goods and services (77%).
While home values have increased nearly 70% in Florida over the past five years, 36% of Floridians who do not own a home say they are delaying buying due to the strong market as well as increased expenses, such as higher insurance premiums. .
Despite this, Florida’s economy has fared better than most, to which the state’s chief financial officer Jimmy Patronis credits DeSantis’ commitment to keeping business and services operational during the COVID-19 pandemic.
“Florida is able to provide this tax relief while having plenty of cash on hand thanks to the Governor’s decision to keep Florida open while battling COVID-19, which has created a more resilient economy – including people from states like New York and New Jersey are flocking in droves,” Patronis said.