Treasury: Anticipated Lower PTBAIT Payments Impact December Collections
(TRENTON) - The Department of the Treasury reported today that December revenue collections for the major taxes totaled $4.747 billion, down $664.0 million, or 12.3 percent below last December. This revenue decline was anticipated, and Treasury expects Fiscal Year 2023 collections growth to further moderate in the coming months, particularly during the spring tax filing season when last year's historically high collection levels are unlikely to be repeated. Fiscal year-to-date total collections of $18.696 billion are up $585.3 million, or 3.2 percent over the same six months last year.
December collections for the Gross Income Tax (GIT), which are dedicated to the Property Tax Relief Fund, totaled $1.571 billion, down $40.1 million, or 2.5 percent below last December. This December had one fewer Wednesday employer withholding payment date compared to a year ago, causing a temporary reduction in revenue for the month. Adjusting for the one less payment, GIT collections would have been up about $143.9 million, or 10.1 percent, compared to last December. Fiscal year-to-date GIT collections of $7.440 billion are up $471.2 million, or 6.8 percent.
The Sales and Use Tax, the largest General Fund revenue source, totaled $985.1 million, an increase of $57.5 million, or 6.2 percent above last December. Due to a one-month lag in the reporting and payment of Sales Tax, December revenue reflects consumer activity in November. This month's Sales and Use Tax growth rate of 6.2 percent exceeded that for both October and November. The NY-NJ-PA Consumer Price Index rose 5.9 percent in November, indicating that real retail sales in New Jersey rose slightly in November, in contrast to declining real growth the prior two months. Fiscal year-to-date Sales Tax collections of $5.339 billion are up $351.6 million, or 7.0 percent.
The Corporation Business Tax (CBT), the second largest General Fund revenue source, totaled $877.1 million in December, a decrease of $57.4 million, or 6.1 percent from last year. The collections decline was mainly driven by a higher level of refunds compared to last year, and a slight decline in the fourth quarter estimated payment receipts. Fiscal year-to-date collections of $2.365 billion are up $52.2 million, or 2.3 percent.
The decrease in the Pass-Through Business Alternative Income Tax (PTBAIT) payments, which was expected, is the primary driver behind December's overall revenue decline. PTBAIT totaled $929.9 million, down $637.1 million or 40.7 percent from the same month last year. The decline was due mainly to the timing of certain taxpayer payments. Large PTBAIT payment surges seen in December of 2020 and 2021 were dampened this year, as more taxpayers became familiar with the tax and adjusted their quarterly estimated payments throughout the tax year rather than in one lump sum in December.
Realty Transfer Fee revenues of $39.6 million were $8.7 million, or 18.0 percent below last year. For the third consecutive month collections have declined year-over-year, continuing to reflect the challenging housing market conditions. Median home prices have been decelerating, but housing inventories remain relatively low, preventing rapid declines in sales prices. Monthly home unit sales continue declining on a year-over-year basis. Year-to-date Realty Transfer Fee collections of $264.8 million are down $13.5 million or 4.8 percent lower than the same period last year.
Please see the attached chart for monthly and yearly revenue collection comparisons.
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