8/10/2023 0 Comments State with unexpected no red inkIn the past few weeks some state governors have outlined new austerity measures that include a slew of budget cuts and tax increases. “If that’s starting to level off then it’s not getting worse, but it’s a long way away from getting better.” “States had a collapse in revenue that was unprecedented,” Shure said. Stimulus funds in the amount of $429.9 billion helped cover between 30 and 40 percent of the states’ shortfalls last year, Shure said. “There are only so many times that you can sell the Brooklyn Bridge,” she added. In addition to spending the now-dry well of stimulus funding, Tracy Gordon, a state and local finance expert at The Brookings Institution, says many states have exhausted most of the one-time fixes they employed to balance their books during the recession (state tax amnesty programs, deferring payments, and internal borrowing). Jon Shure, deputy director of the State Fiscal Project at the CBPP says despite the revenue increases, fiscal year 2012, which starts on July 1 for most states, will be the most difficult budget year on record. The Center on Budget and Policy Priorities, a Washington-based think tank, estimates that for fiscal year 2012, 44 states and the District of Columbia cumulatively face a $125 billion budget gap. The report comes at a time of heightened problems at the state level, as many governors try to close gaping budget deficits. So far, California reports the biggest income tax collection increase over last year - 32 percent - followed by Indiana at 15.9 percent and Massachusetts at 15.8 percent. That includes an average 10.7 percent increase in personal income tax collections and 6 percent increase in sales tax collections. Rockefeller Institute of Government at the State University of New York. Total state tax collections in 41 states showed a 2010 fourth quarter, year-over-year rise of 6.9 percent, according the report released today by the Nelson A. ![]() ![]() Still, the preliminary figures are only about 3 percent above revenue levels from 2009, suggesting state fiscal conditions remain fragile and years away from receiving a clean bill of economic health. State tax revenues increased at the quickest pace in almost five years this fourth quarter as economic gains fueled larger income and sales tax collections, a new report found.
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