Virginia Tax Revenues Exceed Forecast by 3.2% So Far This Fiscal Year

But state officials warn of broader economic weakness, including rising unemployment and consumer sentiment concerns.

Apr. 13, 2026 at 7:34pm

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An abstract illustration using bold geometric shapes in primary colors to conceptually represent the economic trends discussed in the story, without any text or identifiable elements.Geometric shapes and colors illustrate the complex interplay of Virginia's tax revenue growth and broader economic concerns.Richmond Today

Virginia's general fund revenues rose 14.3% in March compared to the same month last year, and are up 7.4% through the first nine months of Fiscal Year 2026, running 3.2% ahead of the official forecast. However, state officials cautioned that broader economic indicators point to weakening conditions, including a softening job market, rising unemployment, and record-low consumer sentiment.

Why it matters

Virginia's tax revenue performance is a key indicator of the overall health of the state's economy. While the stronger-than-expected revenue figures are positive in the short term, the state's top officials are expressing concern about potential economic headwinds on the horizon, including rising fuel costs and global instability.

The details

The growth in Virginia's revenues was primarily driven by strong individual income tax and sales tax collections, though corporate income tax receipts continue to lag behind projections. Finance Secretary Mark Sickles noted that the state's revenue growth remains heavily influenced by volatile tax sources, including nonwithholding income tax payments and lower-than-expected refunds.

  • Virginia's general fund revenues rose 14.3% in March 2026 compared to March 2025.
  • Revenues through the first nine months of Fiscal Year 2026 are up 7.4% compared to the same period last year.
  • Revenues are running 3.2% ahead of the official forecast through the first nine months of Fiscal Year 2026.

The players

Abigail Spanberger

The Governor of Virginia.

Mark Sickles

The Secretary of Finance for the state of Virginia.

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What they’re saying

“While revenues continue to exceed forecast, the broader economic environment is not showing the same strength. The job market has softened. Virginia's unemployment rate has risen half a point over the last year while employment in Virginia has fallen compared to last March.”

— Abigail Spanberger, Governor of Virginia

“Continued caution is still advised given the uncertainty caused by conflict in the Middle East and the consequent rise in fuel costs.”

— Mark Sickles, Secretary of Finance

What’s next

State officials will continue to monitor economic indicators and revenue trends closely in the coming months to assess the overall health of Virginia's economy.

The takeaway

While Virginia's tax revenues have exceeded expectations so far this fiscal year, the state's top officials are expressing concerns about broader economic weaknesses, including a softening job market and rising consumer prices. This highlights the need for continued fiscal prudence and vigilance in the face of potential economic headwinds.