Thursday, June 4, 2015

State Tax Collections Ahead Of Benchmark

State House News Service

The latest tax-collection data appears to underscore the belief that this year's state budget problems were not due to revenue problems.

With one month left in fiscal 2015, tax collections are running $389 million above the benchmark used for budgeting purposes, thanks to $1.84 billion in May receipts that followed the state's first-ever $3 billion month in April. 

The above-benchmark revenues bode well for a potential surplus in fiscal 2015 although the level of end-of-fiscal-year supplemental appropriation needs is not yet known and any surplus will also depend on Baker administration implementation of mid-year spending cuts.

May tax collections were up 13.2 percent over May 2014 and fiscal-year-to-date collections are up 5.9 percent over the same 11-month period in fiscal 2014, not including more than $183 million in large tax-settlement payments. May revenues beat the monthly benchmark by $228 million, mostly due to income-tax collections.

"The improvement in labor markets continues this month as evidenced by the increase in withholding, even after accounting for some possible acceleration of June payments into this month," Revenue Commissioner Mark Nunnelly said in a statement. "We saw further evidence of recovery in the withholding performance with the growth of bonus-related revenues in the finance, insurance and biotech-manufacturing industries." 

The recent two-month corporate and business-amnesty program that ended May 15 resulted in collections of about $15 million, less than the $18 million forecast.

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