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Budget staff briefs committee on sales tax distributions, tax relief fund and risks to general fund

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Summary

Legislative budget staff explained how sales tax collections are distributed under statute (including revenue sharing and the Tax Relief Fund), described recent growth in corporate and sales tax receipts, and cautioned that statutory earmarks have reduced the share of sales tax available to the general fund, increasing vulnerability in downturns.

Legislative fiscal staff provided JFAC a detailed briefing on sales tax distributions, the Tax Relief Fund and broader drivers of general fund revenue, warning that statutory earmarks have reduced the portion of sales tax flowing to the general fund and could make budget balancing harder in an economic downturn.

Keith Bybee reviewed tables in the legislative budget book showing total sales tax collections and statutory distributions. He noted gross sales tax collections were projected to grow to about $3.37 billion in 2025 and $3.50 billion in 2026, but that statutory transfers reduce amounts available to the…

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