COVID costs Florida a 31% dip in sales tax revenue in May

Florida’s sales tax revenue fell 31.7% below projections in May, state economists announced Friday as Gov. Ron DeSantis prepares to make deep cuts to the state budget for the next fiscal year.

Collections were $695.4 million below their estimates, made in January, before COVID-19 sent the state’s tourism-driven economy into a tailspin. All sectors of the economy besides building-related industries were hurt, state economists wrote.

Because sales taxes are collected the month after the sales take place, the revenue reflects the state’s economy in April, when DeSantis imposed a statewide stay-at-home order. Sales taxes are the biggest source of dollars for the state’s general revenue fund, which goes to schools, state agencies and other programs.

Overall revenue collection was down $779.6 million for May, and the state is short $1.45 billion for the current year, a hole the state is plugging with CARES Act money and other federal dollars, Senate President Bill Galvano, R-Bradenton, wrote in a letter to lawmakers on Friday.

DeSantis is preparing to make big cuts to the state’s $93.2 billion budget for the next fiscal year, which begins July 1. State lawmakers passed the budget in March, as the state started to see its first cases of COVID-19.

Galvano noted that revenue collections from April — which reflected activity in March — were down even more, $878.1 million short of the estimate.

“No question that this is still a significant loss, but it is encouraging that hopefully the worst impacts to revenues are behind us as reopening continues,” Galvano wrote.

This story was originally published June 26, 2020 at 12:41 PM.