October tax collections rise 7.4 percent from 2015

NC_taxchanges0122_mezzn[1]

BOSTON (STATE HOUSE) – October may be a relatively small month for tax receipts, but revenue collections last month eclipsed the state’s newly revised estimates by $79 million, putting the state budget on more solid footing just weeks after Gov. Charlie Baker put the brakes on the idea of making emergency mid-year spending cuts.

Department of Revenue Commissioner Michael Heffernan announced late Thursday that tax collections of $7.97 billion over the first four months of the fiscal year are now $79 million, or 1 percent, ahead of projections and $356 million, or 4.7 percent, higher than the same period last year. October collections surged 7.4 percent, or $123 million higher than collections in October 2015.

“October collections are in line with the Commonwealth’s recently-adjusted state tax revenue outlook. While income and corporate collections were ahead of benchmark, sales tax came in slightly below the recently-revised benchmark,” Heffernan said in a statement.

Last month after year-to-date revenues had fallen $11 million off the pace, Baker budget chief Kristen Lepore lowered sales tax estimates by $175 million and detailed what the administration believed to be a $294 million gap in the fiscal 2017 budget. The administration, however, opted against making cuts after legislative leaders urged them to wait, and instead announced a series of “alternative measures” it would take to address the problem, including tapping new non-tax revenues, voluntary payroll reductions and one-time legal settlements.

Income tax collections in October beat benchmarks by 4.5 percent, or $43 million, and corporate and business taxes were $47 million ahead of projections for the month.

The $536 million in sales taxes collected in October fell $2 million short of the newly lowered estimates, but reflected an increase over last year of 2.9 percent that revenue officials attributed, in part, to the lack of a sales tax holiday in August this year that pushed purchasing into September with associated taxes showing up in the October report.

Copyright 2016 State House News Service

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s