Newly released end-of-year revenue totals indicate states largely saw a third consecutive year of slow growth in tax collections in fiscal 2025. Despite modest gains in revenue collections, most states ended the year above both their original and revised revenue forecasts. Comparing actual collections to forecasts is a better indicator of state revenue performance than year-over-year growth figures which, in many states, have been considerably impacted by recently enacted tax cuts. While most states are reporting revenue surpluses, the surplus amounts are relatively small, especially when compared to the substantial surpluses experienced by states in fiscal 2021 and fiscal 2022. A number of states indicated their revenue totals were above forecast by less than one percent, with some also seeing revenues come in slightly below forecast.
As NASBO’s Spring 2025 Fiscal Survey of States highlighted, after the two fastest growing years on record for general fund revenue in fiscal 2021 and fiscal 2022, growth in revenue collections has been modest in each year since. In fiscal 2023 through estimated fiscal 2025, annual general fund revenue growth on a median basis has been between 1 and 2 percent. Preliminary year-over-year totals for fiscal 2025 were largely in-line with recent trends, with most states seeing slow growth in tax collections compared to fiscal 2024, and other states recording modest declines. When examining individual revenue sources, initial data shows that the growth in personal income taxes was slightly higher than the growth in sales tax collections, while most states reported declines in corporate tax collections. Factors impacting year-over-year growth levels included recently enacted tax cuts, strong stock market performance in calendar year 2024, low unemployment levels, slower growth in consumption, and lower inflation.
Similar to recent years, states are anticipating modest revenue gains in fiscal 2026. Recommended budgets for fiscal 2026 are based on general fund revenues increasing 2.4 percent on a median basis. In discussing their end-of-year fiscal 2025 revenue totals and outlooks for fiscal 2026, states noted heightened economic uncertainty, the potential impact of tariffs and federal policy changes, increased spending demands, and the overall resilience of the state economy.
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Forty-six states and one territory (Puerto Rico) ended the fiscal year on June 30. New York finished fiscal 2025 on March 31, while Texas will finish the year on August 31 and Alabama, Michigan, American Samoa, the District of Columbia, Guam, and the U.S. Virgin Islands will finish on September 30. Below are samples of revenue totals from states that have published preliminary data for the full fiscal year and descriptions of some of the factors impacting tax collections:
Arkansas’s gross general revenues for fiscal 2025 were $8.36 billion, a decrease of 4.0 percent from fiscal 2024. Net available general revenues totaled $6.68 billion, 3.2 percent below last year. For the year, net available revenues were above the May 2025 forecast by 2.3 percent. Revenues in excess of the general revenue budget provided a surplus of $367.9 million. Year-over-year declines included individual income tax collections (-6.6 percent) and corporate income tax collections (-28.4 percent), while the sales and use tax increased (1.4 percent) year-over-year. Arkansas’s Department of Finance and Administration noted that year-over declines were primarily attributed to the expected effects of income tax cuts passed in 2024 and that Arkansas had a strong economic performance in fiscal 2025.
California’s total general fund receipts for fiscal 2025 were $233.18 billion, 8.4 percent above fiscal 2024. When looking at individual revenue sources, the personal income tax (4.5 percent) and retail sales and use tax (1.0 percent) increased year-over-year, while the corporation tax (-4.8 percent) decreased. Fiscal 2025 receipts exceeded estimates contained in the May 2025 revision by approximately $3.7 billion, or 1.6 percent. The general fund ending cash balance was $33.82 billion, or 66.1 percent above the May 2025 estimate.
Connecticut’s general fund revenues for fiscal 2025 are estimated at $23.81 billion, 3.1 percent above the original budgeted amount and 0.4 percent above June’s estimate. Both components of personal income – withholding and “estimates and finals” – were above estimates, while both the sales and use tax and corporation tax were below estimates. The operating surplus for fiscal 2025 is projected to be $380.1 million. In discussing the unanticipated surplus, the governor’s Office of Policy and Management noted recent international macroeconomic uncertainty.
Georgia’s fiscal 2025 net tax revenue totaled almost $33.62 billion, an increase of $668.3 million compared to fiscal 2024. The increase was driven significantly by the state’s collection of motor fuel excise tax, which was suspended by Executive Order for a period of two and half months during the fall quarter of fiscal 2024. Adjusting for the year-over-year motor fuel tax changes, year-to-date net tax revenue collections for fiscal 2025 were up $197.4 million, or 0.6 percent. For the year, both individual income tax collections (1.3 percent) and the sales and use tax (3.5 percent) were above fiscal 2024 levels, while the corporate income tax (-9.9 percent) was below.
Idaho’s fiscal 2025 general fund revenues were $5.52 billion, 2.6 percent higher than fiscal 2024’s level. Both individual income taxes (8.5 percent) and corporate income taxes (2.7 percent) grew compared to fiscal 2024, while sales taxes (-4.1 percent) declined. Compared to forecast, fiscal 2025 general fund revenues were 1.7 percent below projections. While revenues came in below forecast, the state closed out the year with a balanced budget and a positive cash balance of $345 million. The governor noted that while there is uncertainty in the market, there are still significant signs of continued growth for Idaho.
Illinois’s total general fund revenue for fiscal 2025 was $54.0 billion, a record high level and a 2.7 percent increase compared to fiscal 2024. Individual income taxes (10.0 percent) and sales taxes (1.0 percent) increased compared to fiscal 2024, while corporate income taxes (-9.5 percent) declined. Actual fiscal 2025 general fund revenues for fiscal 2025 were flat compared to the budgeted amount.
Indiana’s fiscal 2025 total general fund revenues were $22.23 billion, a 3.5 percent increase from fiscal 2024. Year-over-year, both individual income taxes (7.3 percent) and sales and use taxes (2.5 percent) experienced increases, while corporate income taxes (-12.3 percent) declined. Total general fund revenues were 0.8 percent above the adjusted estimated forecast for fiscal 2025. The state comptroller noted that despite April’s lower-than-expected revenue forecast, actions taken by the state, including needed adjustments in spending, allowed Indiana to close the year with a reserve of 11 percent of expenditures.
Iowa’s fiscal 2025 general fund receipts totaled $11.2 billion, a decrease of 4.9 percent compared to fiscal 2024, according to the state’s Department of Management. Personal income taxes (-0.9 percent) and corporate income taxes (-7.3 percent) both decreased compared to fiscal 2024, while sales/use tax receipts increased (1.5 percent). The 4.9 percent decrease in fiscal 2025 general fund receipts was greater than the projected decrease of 4.0 percent.
Kansas’s fiscal 2025 total receipts were $10.02 billion, a 1.2 percent decrease from fiscal 2024. Individual income taxes grew 3.8 percent year-over-year in fiscal 2025, while both corporation income taxes (-7.4 percent) and sales and use taxes (-1.8 percent) decreased. Total receipts in fiscal 2025 were 1.3 percent above the cumulative estimate. In discussing the latest revenue collection figures, the governor said fiscal discipline is needed to avoid returning to prior budget shortfalls.
Kentucky’s fiscal 2025 general fund receipts totaled $15.70 billion, exceeding fiscal 2024 total revenue by 0.8 percent. While individual income taxes decreased 8.4 percent compared to fiscal 2024, both corporate income (46.9 percent) and sales and use taxes (0.3 percent) increased year-over-year. Total general fund revenues also exceeded the official revenue estimate by 0.8 percent. In discussing the yearly revenue totals, the state budget director noted major business taxes far exceeded the official estimates, offsetting lower than forecasted income and sales tax receipts.
Maine ended fiscal 2025 with a $152.2 million general fund surplus. After priority transfers are met, Maine law requires dividing the remaining general fund surplus into an 80/20 percent split between the Budget Stabilization Fund and the Highway and Bridge Capital Fund.
Minnesota’s fiscal 2025 total revenues were $31.91 billion, $847 million, or 2.7 percent, higher than the February forecast. Individual income taxes were 6.8 percent above the February forecast, while general sales taxes (-0.7 percent), corporate franchise taxes (-3.2 percent), and other revenues (1.2 percent) were below forecasted levels.
Mississippi’s fiscal 2025 total general fund revenue collections were $7.64 billion, 0.83 percent less than fiscal 2024. For the year, individual income taxes increased 1.54 percent, sales taxes rose 1.77 percent, and corporate income taxes decreased 24.03 percent. Fiscal 2025 total general fund receipts were 0.54 percent above estimated levels.
Missouri’s net general revenue collections for fiscal 2025 were $13.43 billion, a 0.01 percent increase compared to fiscal 2024. Year-over-year, individual income taxes rose 1.28 percent and sales and use taxes increased 1.23 percent, while the corporate income and franchise tax decreased 5.38 percent.
Nebraska’s fiscal 2025 total net receipts were $6.16 billion, 13.93 percent below fiscal 2024’s level. For the year, sales and use taxes rose 2.36 percent, while individual income taxes decreased 12.07 percent, and corporate income taxes decreased 37.67 percent. Net general fund receipts for fiscal 2025 were 1.4 percent below the forecasted level.
New Hampshire’s fiscal 2025 state revenue totaled $3.12 billion, 6.0 percent less than fiscal 2024. Of the state’s largest revenue sources, business taxes decreased 9.5 percent year-over-year, the room and meals tax increased 3.4 percent, transfers from the Lottery Commission increased 2.4 percent, and the real estate transfer tax grew 18.6 percent. Revenues were $42.4 million, or 1.4 percent, less than estimated.
New York’s state tax receipts totaled $33.2 billion through the first quarter of the state fiscal year 2026 (April-June), $3.3 billion higher than the first quarter of the state fiscal year 2025. Personal income taxes were nearly $3 billion higher than the same period in fiscal 2025, while consumption and use tax collections were $182.5 million higher and business taxes were $176 million above fiscal 2025. In addition, state tax receipts were $580.5 million higher than the most recent Division of the Budget estimate. The state comptroller noted that higher tax collections primarily reflect strong personal income tax collections on 2024 income, while slowing employment and economic growth may present a challenge in the coming months, along with the potential impact of tariffs and federal policy changes.
Ohio’s total tax receipts for fiscal 2025 were $29.22 billion, 4.6 percent above fiscal 2024 levels. Personal income (9.9 percent), non-auto sales and use (2.1 percent), and auto sales and use (3.7 percent) all increased year-over-year, while the state’s commercial activity tax decreased (-5.3 percent). Total tax receipts were also 3.7 percent, or $1.04 billion, above estimated levels. The state budget director noted Ohio remains at or near record high employment levels, which has contributed to strong personal income tax receipts.
Oklahoma’s total revenue for fiscal 2025 was $16.92 billion, 0.2 percent higher than fiscal 2024. Individual income taxes were up 7.8 percent compared to fiscal 2024, while sales tax decreased 5.2 percent and corporate taxes declined 1.5 percent. The state treasurer noted that June’s revenue rebound shows a strong sign of economic resilience and fiscal momentum as the state closes out fiscal 2025 and looks ahead to fiscal 2026.
Pennsylvania’s fiscal 2025 general fund collections were $46.4 billion, 0.7 percent above estimate. For the year, personal income tax revenue was 1.0 percent above estimate, sales tax receipts were 1.1 percent more than anticipated, and corporation tax revenue was 1.2 percent below estimate. The revenue secretary noted that Pennsylvania ended the fiscal year with a meaningful surplus, putting it in a very strong financial position.
South Dakota closed fiscal 2025 with an operating surplus of $63 million. Total revenue finished above forecast by $41 million while spending was $22 million below what was budgeted. Unforeseen unclaimed property receipts were the biggest driver of the excess revenue; the state received more than $47 million in unexpected unclaimed property receipts since the 2025 legislative session. South Dakota’s largest revenue source, the state sales tax, finished the year $3.7 million lower than recent estimates and 0.6 percent lower than collections from the previous year. The governor noted that while South Dakota has seen a slowdown in revenue growth from the years when it was breaking records, the state is now back to more traditional results in the growth of its economy.
Tennessee’s total tax revenues through 11 months have decreased 1.02 percent compared to the same period in fiscal 2024; on an accrual basis, June is the eleventh month in fiscal 2025. On a year-to-date basis, total tax revenues are 0.40 percent more than the budget estimate. Year-to-date performance compared to budgeted estimates includes sales taxes being above estimate by 0.93 percent, corporate taxes below estimate by 4.56 percent, fuel taxes below estimate by 0.37 percent, and all other taxes above estimate by 6.81 percent. Tennessee’s Department of Finance and Administration Commissioner said that with one month left in the fiscal year, they remain optimistic and will continue to monitor year-end results.
Utah’s fiscal 2025 revenue to the General and Income Tax Funds as $12.0 billion, a year-over-year growth rate of 4.2 percent and 2.8 percent above the February consensus revenue estimate. General fund collections totaled approximately $4.29 billion, growing at 0.9 percent year-over-year and 1.0 percent ahead of the forecasted growth. When adjusted for earmarks, sales taxes grew at 3.0 percent, which is 0.6 percent ahead of forecast. Income tax fund collections were $7.68 billion, for a year-over-year growth rate of 6.7 percent. The fund overall outpaced the forecast by 4.7 percentage points due in large part to strong individual income tax growth throughout the year as well as corporate tax’s accelerated growth in the second half of the year.
Virginia’s fiscal 2025 general fund revenues grew 6.1 percent compared to fiscal 2024. Net individual income tax collections were 7.8 percent above prior year collections and sales tax collections were up 2.2 percent compared to last year. Fiscal 2025 revenues exceeded forecast by $572.0 million, or 1.9 percent. The Secretary of Finance noted that economic conditions are generally aligned with the state’s most recent forecast. Additionally, when combined with approximately $900.5 million in bottom-line unappropriated balances resulting from the governor’s actions in May, Virginia has a cash position of almost $1.5 billion.
West Virginia’s fiscal 2025 general revenue collections were $5.52 billion, 3.4 percent less than fiscal 2024. Personal income taxes decreased 5 percent year-over-year, the sales and use tax had flat growth, the severance tax increased 19 percent, and the corporate net income tax decreased 19 percent. For the year, revenues were $254.8 million, or 4.8 percent above projections. In discussing the fiscal 2025 revenue totals, the governor said that while ending the year with a surplus is a good thing, looming federal actions and an increase in state mandatory spending requires the state to make smart, fiscally conservative decisions as it begins the new fiscal year.