NASHVILLE - Tennessee tax collections inched up in February with overall revenues up $5 million over projections, but Finance Commissioner Mark Emkes said he is concerned rising fuel prices and Congress' failure to enact a budget "will soon begin to erode the positive growth trend we are now enjoying."
Revenues in February, which reflect January activity, came in at $744.3 million. The $5 million increase came despite the end of a federal payroll tax holiday and the resumption of higher deductions on Social Security.
Analysts have expected that to affect consumer spending, which in turn drives the main source of tax revenue for Tennessee - the sales tax.
"Total collections in February marked the seventh consecutive positive growth month this [fiscal] year," Emkes said in a news release. "Sales tax collections, reflecting January spending, recorded modest growth as did several of the smaller tax categories."
He said officials continue to believe the modest growth rate in sales tax collections "is indicative of a very slow but improving economy in Tennessee." But he then goes on to state his concerns about gas prices and the federal budget.