by Bill McBride on 2/23/2010 08:10:00 AM
Tuesday, February 23, 2010
From the Rockefeller Institute: States Reported Fifth Consecutive Drop in Tax Collections in the Fourth Quarter of 2009 (ht Ann)
State tax revenues declined by 4.1 percent nationwide during the final quarter of calendar 2009, the fifth consecutive quarter of reduced collections, according to a report issued today by the Rockefeller Institute of Government.Here is the report: Final Quarter of 2009 Brought Still
The five straight quarters of year-over-year decline in overall tax collections represent a record length of such decreases, the Institute said.
“Calendar 2009 will be remembered as bringing historically sharp declines in tax revenue to states,” the report says. “Revenue gains toward the end of calendar 2009 were often driven by legislated tax increases rather than growth in the economy and tax base.”
Despite revenue gains in some states during the fourth quarter, the report concludes, “another negative quarter for the nation as a whole would not be unexpected. The troubling fiscal picture for states remains clearly in place.”
More Declines in State Tax Revenue
Tax revenues are still weak, and most states are still running large deficits. As a recent CNNMoney article notes:
States are looking at a total budget gap of $180 billion for fiscal 2011, which for most of them begins July 1. These cuts could lead to a loss of 900,000 jobs, according to Mark Zandi, chief economist of Moody's Economy.com.This suggests that more state and local government job cuts are coming.
Posted by Bill McBride on 2/23/2010 08:10:00 AM