More Good News Than Bad as April Tax Collections Wind Down
With one day left in the month, April revenue forecasts have exceeded expectations – on both sides of the ledger.
Through April 29, income tax payments were $7.1 billion — $300 million more than projected in Gov. Jerry Brown’s January budget proposal, according to a Franchise Tax Board daily tally.
Bank and corporations tax collections for the month were $27 million short of the budget’s $1.6 billion estimate.
Requests for refunds, however, totaled more than $2.6 billion, $100 million more than estimates by Brown’s Department of Finance.
Another $2.8 billion is projected to be collected by the Employment Development Department through the withholding payments employers carve out of employee paychecks.
Coming into April, state tax collections — including sales tax — were running $2 billion above the level projected by the Department of Finance for the current fiscal year, which began July 1.
Any revenue above estimates helps reduce the state’s budget gap – pegged at $26.6 billion by the Democratic governor.
Brown has said he will propose a “balanced” revised spending plan by May 14 to close the remaining $11 billion budget gap left after lawmakers passed a series of spending reduction measures in March.
The higher-than-anticipated revenue allows him to fill less of the budget hole with spending reductions, a large amount of which will likely fall on public shools and the state’s university systems.
Income tax receipts represent 53 percent of the state’s annual revenue. Of that total, 16 percent was collected in April during the last fiscal year, according to State Controller John Chiang.
Filed under: Budget and Economy
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