Kansas state tax revenue tops estimate by 6.1% in first quarter of budget year

Kansas House Speaker Dan Hawkins, left, says he welcomes the Kansas Department of Revenue report showing the state government collected $147 million in taxes than anticipated during the initial three-month period of the 2027 fiscal year. The photograph of Hawkins, a candidate for state insurance commissioner, a Jan. 8, 2026, meeting at the Capitol. (Photo by Sherman Smith/Kansas Reflector)

TOPEKA — The state of Kansas collected $147 million more in taxes than anticipated during the first quarter of the fiscal year as income, sales and excise revenue exceeded expectations by a combined 6.1%, state officials reported.

Fiscal analysts predicted revenue from corporate and business income taxes, retail sales and compensating use taxes, tobacco and liquor taxes, oil and gas severance taxes, as well as insurance premium and motor carrier taxes, would bring in $2.42 billion in July, August and September. Actual receipts during the three-month period were $2.57 billion, or $147 million more than expected in the first quarter of the 2027 fiscal year.

The report from the Kansas Department of Revenue showed taxes collected by the state during the first quarter of the 2026 fiscal year amounted to $2.36 billion. That was $208.5 million, or 8.8%, less than in the same point in the current fiscal year.

“Three months into the new fiscal year, the results are encouraging,” said House Speaker Dan Hawkins, a Wichita Republican. “There will always be ups and downs from month to month, but after a full quarter, these are numbers worth paying attention to.”

The Republican-controlled Kansas Legislature and Democratic Gov. Laura Kelly produced state budgets the past two years that spent approximately $700 million more than the state generated in tax revenue. If the state’s revenue trend held through June 2027, it could moderate implications of overspending.

In the first quarter of this fiscal year, Kansas took in $53.8 million more than anticipated in corporate income tax and $50.7 million more that projected in individual income tax. In addition, revenue from sales exceeded the projection by $30.6 million.

“We’ve spent years proving that every additional dollar that comes into Topeka doesn’t automatically have to become another dollar of government spending,” said Hawkins, a candidate for state insurance commissioner.

In September, corporate income tax receipts submitted to the state government were $58.2 million above the official estimate, while individual income tax collections were $13.3 million below the prediction. Retail sales taxes owed the state hit $308.6 million in September, which was $2.8 million above the estimate.