- The Washington Times - Wednesday, April 16, 2008

RICHMOND (AP) Virginia’s tax collections were up slightly last month, even as the nation’s economy continued its nose dive and Virginia’s housing market cooled.

Thanks to increased income-tax collections and fewer tax refunds, general fund revenue that supports such core operations as public safety, education and health care topped $1 billion last month.

That is a 3.2 percent increase over the $973 million in March 2007 general fund receipts, according to a monthly revenue report given to Gov. Tim Kaine by Finance Secretary Jody M. Wagner on Monday.

Individual state payroll withholding taxes increased modestly from $769 million in March 2007 to $795 million last month, a 3.4 percent jump. But taxes paid by the self-employed and on dividends increased by 35 percent, from $56 million to $76 million.

Income-tax refunds last month decreased to $313 million from $342 million in March 2007.

Income taxes constitute nearly three-fourths of the state’s general fund.

The report reflects Virginia’s economy the same month that legislators adopted cuts and used cash reserves to avert a projected $640 million shortfall by the June 30 end of the budget year.

With three-fourths of the fiscal year ended, general fund tax collections stood at $10.9 billion. That’s 2.5 percent ahead of revenues at the same point last year and ahead of the revised 1.2 percent general fund growth rate assumed in the current budget.

Distressing signs persisted for the housing industry.

The tax paid to record real estate deeds, wills and contracts declined 28 percent for the month, and for the fiscal year thus far it is one-fifth lower than at the same point in 2007. Mrs. Wagner attributed it to the slowing real estate industry.

Corporate income taxes and the tax paid on insurance premiums also lagged substantially behind last year’s levels.

Sales taxes, which account for one-fifth of Virginia’s general fund, grew by 2.3 percent for February, but only by 1 percent for the year to date, short of the budgeted growth estimate of 1.6 percent. Sales taxes lag one month behind because retailers collect an entire month of receipts, then remit them to the state the following month.s

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