Rockefeller Institute: trouble is brewing
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- October
- 7
ÂÂ ÂÂ The Nelson A. Rockefeller Institute of Government’s quarterly state tax revenue report cautions that “damage is just beginning” in state budgets, with revenue declines likely leading to more widespread budget cuts in the coming months.
ÂÂ ÂÂ Taxes that states collected during the second quarter of 2008 increased about 3.6 percent, according to the Rockefeller Institute, part of the State University of New York. Income tax collections were up by 6.6 percent over the same period in 2007, but state sales tax collections went down 1.4 percent, corporate income taxes dropped 8.3 percent and motor fuel taxes fell by 3.4 percent.
ÂÂ ÂÂ When adjusted for inflation, overall state tax collections increased 1.5 percent over the previous year, theÂÂ institute found.ÂÂ
ÂÂ ÂÂ “Superficially, tax collections appeared to be doing okay—certainly not the leading edge of a fiscal crisis. But below the surface, great trouble is brewing,” said Donald Boyd, Rockefeller Institute senior fellow. “Some states have already made mid-year budget cuts, and more widespread cuts are virtually certain as revenues deteriorate further.”
ÂÂ ÂÂ Arizona, California, Florida, Michigan and Rhode Island have been suffering the most, according to the report, and fiscal problems are expected to spread to Connecticut, New Jersey and New York. California isÂÂ also on the list. New York lawmakers have already cut the state budget a few times because of lower income-tax collections and projected budget shortfalls. Gov. David Paterson has requested that they return to Albany next month to further reduce this year’s spending.
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on Tuesday, October 7th, 2008 at 11:56 am by Cara Matthews.
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