FY 2025 Revenue Tracker

Kansas Action for Children | Updated January 17, 2025

Each month, the Kansas Division of the Budget reports how much tax revenue the state collected for the previous month. Forecasts are released by the Consensus Revenue Estimating Group twice a year, which actual monthly collections are then compared to. These forecasts help lawmakers understand how much total tax revenue they can expect to see in the state coffers, which in turn helps them develop the state’s budget for the cost of government services and operations for the upcoming fiscal year.

Read our explainer on how the state budget works.

KAC’s revenue tracker provides a visual snapshot of each monthly report and how the revenue side of the budget is being funded to achieve a balanced budget.

December 2024

Revenue highlights:

• Actual collections for December 2024 were 6.3%, or $66.7 million, above the estimate for the month, which translated to an 8.1% increase compared to December 2023. 

• Year-to-date collections (July 2024 through December 2024) are above estimates by $41.4 million, or 0.9%.  

• To date, Kansas has collected 50.0% of the $9.65 billion in total expected revenue for FY 2025. 

• Corporate tax collections had a breakout month in December 2024, coming in $45.4 million, or 19.7%, above estimates for the month.  

For additional details, see the December State General Fund Revenue Receipt update.

Big Picture Takeaway — Revenue Rebound?

December proved to be an excellent month for state revenue collections, as total taxes exceeded expectations by 6.3%. This was driven largely by strong income tax collections, which were higher than estimates by $77.9 million, or 11.8%. 

However, despite being the peak month of the holiday season, retail sales in December beat estimates by only 0.4%, or $788,651, and were about $5.7 million, or 2.6%, lower than in December 2023. This is not entirely unexpected given the lower state sales tax on groceries compared to last year, and we can likely expect another over-the-year decline in 2025 as the state grocery tax was eliminated on January 1. Unfortunately, this small sales tax beat was heavily offset by a large miss on compensating use taxes, resulting in total sales and use tax collections coming in 4.5%, or $13.6 million, below expectations. 

Even still, December was a strong month and brought in about $130.1 million, or 2.8%, more than this time in FY 2024. With many new tax policies in place as we head into the tax filing season, it remains to be seen if revenues will continue to outpace last year’s performance or if the state’s coffers will become sluggish for the last half of FY 2025. 

November 2024

Revenue highlights:

• Actual collections for November 2024 were 3.6%, or $25.4 million, below the estimate for the month but were up 4% compared to November 2023. 

• Year-to-date collections (July 2024 through November 2024) are lower than estimates by $25.4 million, or 0.7%.

• To date, Kansas has collected 38.3% of the $9.65 billion in total expected revenue for FY 2025. At this time last year, 35.8% of total revenue had been collected, although revenue estimates were more ambitious than they are currently.

• Corporate tax collections continued to come in below estimates, with November 2024 collections $5.9 million, or 19.4%, below expectations.

For additional details, see the November State General Fund Revenue Receipt update.

Big Picture Takeaway — Falling Short

The first report since the Consensus Revenue Estimating Group met in November adds clarity to their decision to revise down their total revenue expectations for FY 2025. State General Fund (SGF) receipts missed expectations across the board in November, with total tax collections below estimates by 3.6%. This shortfall was driven largely by $20.8 million less in income taxes than expected.

Compared to last year, SGF receipts were modestly higher both in November and year-to-date collections. These higher revenues are primarily the result of elevated individual income tax collections as corporate income and retail sales tax collections remain lower than in FY 2024.

The November report, combined with the latest CRE estimates, indicates that Kansas is falling short of prior expectations. Anticipated state revenue in FY 2025 has been revised down and is now expected to decline compared to FY 2024.

With the holiday shopping season beginning earlier than it “traditionally” does, there were hopes that retail sales would close some of the gap made by poor income tax collections. But even retail sales are not fully meeting expectations, falling about $3.6 million, or 1.7%, below estimates.

As government costs typically rise faster than costs generally, any decline in revenues is particularly concerning for the long-term financial health of the state. December results will be telling if the state continues to lag behind estimates or if the busiest shopping month of the year will give the state any boost.

October 2024

Revenue highlights:

• Actual collections for October 2024 were 3.4%, or $23.4 million, below the estimate for the month and 2.5% lower than October 2023.   
  
  
• Collections for the fiscal year to date (July 2024 through October 2024) are now $928,369 above cumulative estimates.
  
  
• To date, Kansas has collected 29.7% of the $10.16 billion in total expected revenue for the current fiscal year. This same time last year, about 29.2% of the total estimated revenue amount had already been collected.
  
  
• Corporate tax collections were $21.9 million, or 36.5%, lower than October revenue expectations.

For additional details, see the October State General Fund Revenue Receipt update.

Big Picture Takeaway — Remarkably Close

As we finish out the first quarter of the fiscal year and head into the holiday season, Kansas is keeping a steady revenue pace. Kansas is currently right on track to meet estimates for the fiscal year despite revenues being lower in October.

October was the filing deadline for individual tax filers who received an extension. Now, all receipts for the 2023 tax year have been reconciled. We will learn more about what to expect for the rest of FY 2025 when the Consensus Revenue Estimating Group convenes on November 15 to adjust expectations based on revenues so far.

On a cumulative basis, collections for FY 2025 remain slightly higher than at this time in FY 2024. These higher collections have been driven primarily by individual income taxes, which have offset the cumulative shortfall in corporate income and retail sales tax receipts.

Though actual individual income tax collections exceeded expectations for the past three months by $96.0 million, or 9.5%, October’s individual income tax collections sat just 0.5% above expected revenues. We’ll likely see some volatility in this category soon when the Special Session tax cuts are finally reflected in revenue collections.

Retail sales tax collections were 1.0%, or $2.3 million, below expectations in October. Though slightly lackluster in October, Kansas should see a significant increase in retail sales tax collections in November, as retailers have already released holiday deals before the “traditional” start of seasonal shopping on “Black Friday.” Hopefully that will give Kansas a boost before heading into the 2025 legislative session, when lawmakers will decide how to allocate state spending.

September 2024

Revenue highlights:

• Actual collections for September 2024 were 0.8%, or $8.0 million, above the estimate for the month and 3.2% higher than September 2023.    

• To date, Kansas has collected 23.1% of the $10.16 billion in total expected revenue for the current fiscal year. 

• Corporate tax collections were $61.9 million, or 21.4%, lower than revenue expectations, although individual income tax collections were $68.1 million higher than expected. 

For additional details, see the September State General Fund Revenue Receipt update.

Big Picture Takeaway — Holding Steady

As the first few months of each fiscal year normally see higher-than-expected revenues, September’s collections beating estimates by 0.8% is unremarkable. Kansas is still well within the range of collections needed to follow a successful trajectory this fiscal year, especially if a trend of slightly higher revenue emerges. We will learn more about what to expect for the rest of FY 2025 when the Consensus Revenue Estimating Group reconvenes in November to adjust revenue expectations based on revenues so far.  

Actual individual income tax collections exceeded expectations for the past three months by $96.0 million, or 9.5%. As a result, we may see an adjustment in expected individual income tax revenue throughout the remainder of the fiscal year. Individual income tax revenue continues to more than offset the lackluster corporate income tax receipts, but it’s unclear how long that will continue after the effects are realized from the Kansas Legislature’s income tax rate reductions during the Special Session in June 2024.  

Retail sales tax collections were also ahead of expectations in September, possibly indicating continued robust consumer spending. However, retail sales tax revenue is expected to decline significantly once groceries are removed from the tax base beginning in January 2025. The Consensus Revenue Estimating Group will have many new factors to consider when they meet in November.  

August 2024

Revenue highlights:

• Actual collections for August 2024 were 3.5%, or $22.80 million, above the estimate for the month and 4.0% higher than August 2023.    

• To date, Kansas has collected 13.0% of the $10.16 billion in total expected revenue for the current fiscal year. 

• Corporate tax collections were $9.8 million, or 32.8%, lower than revenue expectations, although individual income tax and retail sales tax collections were $19.4 million, or 6.3%, and $8.7 million, or 4.1%, higher than expected, respectively.  

For additional details, see the August State General Fund Revenue Receipt update.

Big Picture Takeaway — A Normalizing Economy

As the first few months of each fiscal year normally see higher-than-expected revenues, this month of collections beating estimates by 3.5% is good news. With the better-than-expected revenues in August making up for July’s slightly lower revenues, Kansas is still well within the range of collections needed to follow a successful trajectory this fiscal year.

Individual income and retail sales tax collections were above estimates for the second month in a row. Collections in these categories were also approximately 10% higher than in August 2023. Individual income tax collections above estimates could indicate higher-than-expected earnings or increased compliance. Elevated retail sales receipts may reflect strong consumer spending, which is characteristic of a healthy economy. If this trend continues, Kansas can easily stay on track to hit the $10.16 billion revenue prediction by next June. But with no guarantee that other receipts will continue coming in above estimates, hitting that target could be more difficult if corporate tax collections consistently come in well under estimates, as has been the case for the second month in a row.

July 2024

Revenue highlights:

• Actual collections for July 2024 were 1.0%, or $6.4 million, below the estimate for the month and 3.0% lower than July 2023.

• To date, Kansas has collected 6.5% of the $10.16 billion in total expected revenue for the current fiscal year.

• Corporate tax collections were $15.7 million, or 31.4% lower, than revenue expectations, although individual income tax and retail sales tax collections were $8.5 million, or 2.8%, and $6.4 million, or 2.8%, higher than expected, respectively.

For additional details, see the July State General Fund Revenue Receipt update. 

Big Picture Takeaway — Let's Keep Watching

Coming off a tax-focused special legislative session that determined the direction for revenue expectations in this new fiscal year, revenue receipts were understandably lower than state estimators predicted back in April. This might leave some lawmakers and state agencies nervous, knowing that the first few months of the Kansas fiscal year are typically stronger revenue months.

Corporate income taxes were $10.5 million, or 23.3%, lower than this month last year, which is not cause for alarm since corporate tax collections are volatile due to the corporate “big hitters” that Kansas relies on. As FY 2025 continues, we are watching how the tax decisions made during the June special session impact future incoming revenues — and whether Kansas lawmakers will need to course correct when they return in January.

Because the budget cycle never ends, the start of FY 2025 is also the start of the budget planning process for upcoming FY 2026. In July, state agencies receive guidance from the Department of Budget to begin recommendations and requests to fund the programs and services that impact our daily lives. In the coming months, agencies will receive input from legislative committees, staff, service providers, advocates, and the public to finalize priorities and ultimately decide what will be submitted to the Governor’s Office for inclusion in the Governor’s Budget Report – the formal proposed budget to the Legislature that serves as the starting point for the FY 2026 budget.

This year, Kansas lawmakers have launched an interim committee to study possible changes to this process, specifically allowing legislators to plan the budget without the Governor’s Budget Report. We will keep you updated on their decisions this fall.

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