Virginia General Fund Revenues Up 5.4% Through August

Virginia’s General Fund revenues grew 5.4% through the first two months of Fiscal Year 2027, putting collections ahead of the state’s official forecast, according to figures announced by Gov. Abigail Spanberger.

Through Aug. 31, General Fund revenues were up $236.5 million compared with the same period last year and stood 1.8%, or $81.5 million, above the official forecast.

August revenues alone increased 2.8% compared with August 2025. State officials said strong sales and use tax collections have driven much of the early fiscal-year growth.

“Revenue remains generally in line with our forecast through the first two months of the fiscal year, though continued national economic uncertainty means we must stay vigilant,” Spanberger said.

The governor pointed to inflation, labor-market uncertainty and other national economic pressures as reasons for caution even as Virginia’s revenues remain ahead of expectations.

Spanberger also used the announcement to criticize federal policy, including what she described as high costs tied to the president’s war. Those comments reflected the governor’s political assessment of national economic conditions.

She said Virginia would continue to manage state finances with an eye toward preparing for possible economic challenges while focusing on affordability, the state’s business climate and investment across the Commonwealth.

Secretary of Finance Mark D. Sickles said August is typically a relatively light month for state revenue collections because no major quarterly deadlines affect key revenue sources, including nonwithholding and corporate income taxes.

“Withholding collections came in $37.3 million below forecast for the month, though that is well within the normal range of monthly variance for that source,” Sickles said.

At the same time, sales and use tax collections continued to perform above expectations, growing 4% for the month.

Sickles said state officials are also watching inflation and interest-rate conditions.

“We are concerned by persistently high core inflation and the resulting increased likelihood of a Federal Reserve rate hike,” he said.

The August report provides an early look at Virginia’s finances for Fiscal Year 2027, which began July 1.

Because only two months of the fiscal year have passed, the figures represent an early snapshot rather than a full picture of the state’s annual revenue performance. Collections can vary significantly from month to month depending on tax-payment schedules, economic activity and other factors.

Still, the year-to-date numbers show Virginia entering the fall with revenues ahead of both the prior year and the state’s official forecast.

General Fund revenue is a main source of support for state government operations and programs. Collections include individual income taxes, sales and use taxes, corporate income taxes, and other revenue sources.

The 5.4% year-to-date increase means the state has collected $236.5 million more than it had at the same point last year.

The $81.5 million margin above forecast is also significant because the state budget is built around projected revenue collections. When actual revenue comes in above or below those estimates, it can affect budget decisions later in the fiscal year.

For now, state finance officials are emphasizing both the positive early numbers and the uncertainty surrounding the broader economy.

Sales tax receipts have been one of the strongest areas so far, while withholding collections fell below the monthly forecast in August.

Sickles cautioned that the lower withholding figure should not necessarily be viewed as a sign of broader weakness, describing the $37.3 million shortfall as being within the normal range of month-to-month variation.

The administration said it will continue monitoring revenue trends as more data becomes available.

Virginia’s full August 2026 revenue report includes additional detail on individual tax categories and broader collection trends.