Virginia releases end of year revenue report; $236.5 million below forecast

Virginia

RICHMOND, Va. (WAVY) — Governor Ralph Northam announced on Thursday that Virginia ended the fiscal year 2020 with a deficit of about $236.5 million in general fund revenue collections.

The deficit was expected because of the pandemic and the impact on the state’s economy and budget, however, officials said it is smaller than anticipated.

“COVID-19 has created both a health crisis and an economic crisis, and we have to box in this virus before we can fully address its fiscal impacts,” said Governor Northam.

“While I am pleased that our revenue shortfall is less than initially expected, we know this pandemic will continue to negatively affect our state’s finances as long as this virus is with us. We must all keep taking steps to protect public health so we can continue our economic recovery and ensure the Commonwealth remains on strong financial footing.”

Data shows that total revenue collections rose by 2% in fiscal year 2020 — behind the forecast of 3.1% growth.

Officials said that the main influencers of the revenue shortfall were payroll withholding and sales taxes which both contributed $351.5 million to the deficit. Nonwithholding income tax payments were on target and income tax refunds had a positive contribution to the bottom line revenues by $146.3 million. Additionally, total revenues were $3.1 billion in June which is a 26.7% increase, as the due date for payments was extended to June 1. 

The full release with an analysis of Fiscal Year 2020 Revenues (based on preliminary data) can be found here.


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