No Guarantees On April Tax Collections But Trend is Good
The trend line is good for April income tax collections.
But, as of April 14, the state is still more than $9.3 billion away from the $10.48 billion estimate Gov. Arnold Schwarzenegger used to create his budget proposal for the fiscal year beginning July 1.
As Californians scramble to file their taxes by April 15, state budget writers are anxiously watching revenue collections. The real test of whether the state meets its revenue goals, however, will come next week after taxes are filed.
To date, income tax receipts for the month total just over $1.1 billion.
April is a critical revenue month. During the last fiscal year, which ended June 30, 2009, 51 percent of the state’s General Fund revenue came from personal income tax collections — 17 percent of which arrived in April.
While the week commencing April 12 isn’t a terribly accurate gauge of how the month will end, it’s always good to see the line moving upward.
On April 12, the Franchise Tax Board reported receipts of $116.5 million. On the 13th, receipts of $220.3 million. And on the 14th, $288.7 million.
Receipts should jump sharply after April 15, particularly the Monday after the first weekend following the filing deadline. Last year, for example, on Monday April 20, collections of $1.2 billion were reported.
April is also a significant month for bank and corporation tax collections. Schwarzenegger predicts $1.92 billion will be received this month — $250.6 million has crossed the state’s transom so far.
Again, the week following the filing deadline is a better indicator of how the month will fare but, here too, the trend is good.
On April 12, bank and corporation tax collections were $33.9 million. The following day they rose to $44.7 million and on April 14 collections hit $48.1 million.
Through February, the state’s three major sources of revenue – income tax, bank and corporations tax and sales tax – are running $1.9 billion above the estimates in the GOP governor’s January budget proposal.
Personal income tax is up $911 million. Sales tax is up $615 million. And bank and corporations tax is up $364 million.
Schwarzenegger will use the new revenue figures to recast his budget plan in the so-called May Revision, which occurs during the second week of the month.
Filed under: Budget and Economy
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