Minnesota Q1 tax revenue beats forecast by $897 million

Minnesota's general fund revenue for the first quarter of the fiscal year totaled just over $8.6 billion, which was $897 million, or 11.6%, higher than the forecast issued in February, according to a Revenue and Economic Update from Minnesota Management and Budget reported by power96radio.com.

Individual income tax collections accounted for nearly $4.5 billion, exceeding projections by $441 million, or nearly 11%. Sales tax revenue generated nearly $2.3 billion, which was $122 million, or 5.6%, above the forecast.

Corporate tax payments surpassed $1 billion and were 28% higher than projected. Additionally, revenue from fees and other miscellaneous sources reached $784 million, 17% above predictions.

Looking back at the previous fiscal year ending in June, Minnesota's overall general fund revenues were just under $33.5 billion, slightly above projections by $219 million, or less than 1%.

The economic consultant for the state noted that the U.S. gross domestic product growth outlook for 2026 has weakened since February but improved for 2027 and 2028, with GDP growth projected at 2.4% in 2026, 2.7% in 2027, and 2.4% in 2028.