FRANKFORT, Ky. — The Office of State Budget Director announced today Kentucky’s General Fund receipts for July, the first month of Fiscal Year 2025 (FY25), totaled $1,294.4 million, a 12.2% increase compared to July 2023.
The official revenue estimate for FY25 calls for revenue to increase 0.1% compared to FY24 actual receipts. Therefore, tax revenue can decline 0.9% over the remaining 11 months of the fiscal year and still meet the budget’s General Fund revenue estimate.
“General Fund revenues posted substantial growth primarily in the corporate income tax, which accounted for most of the growth compared to July 2023,” State Budget Director John Hicks said. “Sales tax receipts were flat, and individual income tax receipts are affected by a 11.1% reduction in the tax rate, from 4.5 to 4.0%.”
Among the major accounts:
- Corporate income tax receipts of $258.8 million exceeded July 2023 amounts by $220.8 million. This was the second largest monthly collection in the 18 years since the corporate taxes underwent significant reform.
- Individual income tax receipts fell 21.0% while the tax rate declined by 11.1%.
- Sales tax revenues fell slightly by 0.7% to $518.6 million, but the level of collections is the third largest monthly total outside of winter holiday collections.
- Cigarette tax collections increased 3.0% for the month to $21.8 million.
- Property tax receipts declined by 28.8% due primarily to the omitted and delinquent property tax accounts. Early in the year, it is common to see large percentage changes in property tax collections because of the collection schedule.
- Coal severance tax revenues declined by 23.2% to $6.0 million.
- Lottery revenues increased 4.1% to $25.5 million.
- Income on investments increased 77.8% to $37.6 million — the largest monthly total ever recorded.
Road Fund revenues for July totaled $163.5 million, a 14.6% increase compared to last July. The official Road Fund revenue estimate for FY25 calls for revenue to decline 2.9% compared to FY24 actual receipts.
Based on the first month’s receipts, revenues can decline 4.3% for the rest of the fiscal year and still meet the official estimate. Motor fuels tax receipts are expected to decline starting with August receipts due to a 2.3% tax rate decrease that went into effect July 1. Motor fuels tax collections from July are due to the state in the month of August.
Among the major Road Fund categories:
- Motor fuels tax receipts grew 8.0%.
- Motor vehicle usage tax rose 24.2%.
- License and privilege taxes posted growth of 5.3%.
