FY 2023 Special Report on Preliminary Revenues released Published on Wednesday, September 27, 2023 Providence, R.I. -- The Office of Revenue Analysis (ORA) today released its FY 2023 Special Report on Preliminary Revenues. This report provides a detailed look at FY 2023 preliminary revenues as provided in the Controller’s Preliminary General Fund Revenue Report for FY 2023 and compares these revenues to both the final enacted FY 2023 revenue estimates and the audited FY 2022 revenues. Preliminary FY 2023 Revenues vs. FY 2023 Final Enacted Revenue Estimates The report shows that preliminary FY 2023 total general revenues led the final enacted FY 2023 revenue estimates by $12.3 million or 0.2%. Some notable variances to enacted revenues are as follows: Personal income tax only trailed estimates by $94,890. Estimated income tax payments and refunds were negative compared with prior assumptions, but they were compensated by higher withholding payments and a larger net accrual. Sales and use tax trailed enacted estimates by $14.2 million, a variance of -0.9%. This was partially due to higher-than-usual refund activity. Preliminary FY 2023 Revenues vs. Audited FY 2022 Revenues The report shows that preliminary FY 2023 total general revenues grew compared to audited FY 2022 revenue by $7.3 million or 0.1%. Some notable variances between FY 2023 and FY 2022 revenues are as follows: Total personal income tax revenue shrank 8.7% in FY 2023 compared to FY 2022. Strong capital gains income contributed to historically strong revenue in FY 2022. Estimated and final income tax payments shrank by double digits in FY 2023, likely due to the lack of similar capital gains income. Withholding payments grew by 3.9%. Sales and use tax grew by 3.5% in FY 2023, following several years of double-digit growth. Consumers shifted away from taxable goods spending and toward generally untaxable services spending. One notable service sector where sales tax is applied, meals and beverage, outpaced overall sales tax growth and grew by 8.2%. Business corporations tax revenue decreased by 5.5% in FY 2023. FY 2023 experienced the second highest revenue in this category, trailing only FY 2022. Lottery revenue increased 11.8% as operations continued to stabilize post-pandemic. The online sports betting component of lottery revenue increased by 48.1%. Cigarette revenue declined by 10.8%, exceeding the FY 2022 decline of 6.2%. Departmental receipts and other miscellaneous revenues each benefited from higher interest payments on state cash balances, growing at 13.8% and 208.9% respectively. Large payments helped estate and transfer tax collections to grow by $43.0 million, or 109.4%, from FY 2022. High mortgage interest rates negatively impacted the housing market, with realty transfer tax down 25.3% from FY 2022. The entire report can be found on the Department of Revenue’s web site at https://dor.ri.gov/revenue-analysis/monthly-reports-fy22-fy11/fiscal-year-2023. Questions or comments on the report should be directed to Paul Grimaldi, Chief/Program Development, by e-mail at firstname.lastname@example.org or by phone at (401) 378-1080.