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State misses revenue mark first time this year, still ahead of budget

By Brandon Smith

Posted October 31, 2022

lauren c statehouse

Through three months of the 2023 fiscal year, Indiana is more than $400 million ahead of its state budget needs. (Lauren Chapman / IPB News)

Indiana tax collections came in below projections last month, for the first time in more than a year.

But state budget expert said that missed projection is mostly a timing issue.

The state bases its tax collection expectations on occasional revenue forecasts. The last one of those was in December. And Indiana revenues last month came in about $82 million lower than that forecast expected. That’s more than 4 percent off the mark – and the first time Indiana has failed to exceed expectations since July 2021.

But state budget analysts said almost all of that is because of a delay in processing income tax payments. Those funds, which should’ve been recorded in September, will instead show up on the state’s books in October. And that delay accounts for about $70 million of that $82 million shortfall.

READ MORE: Lawmakers send $1 billion tax cut package to governor's desk

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The state says the rest can be chalked up to the legislature repealing two utility taxes during its last session (which wasn’t accounted for in that December forecast).

Still, Indiana is way ahead of its current state budget – more than $400 million better than needed through just three months of the fiscal year.

Contact reporter Brandon at bsmith@ipbs.org or follow him on Twitter at @brandonjsmith5.

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