State Revenue, Including Sales Tax, Up Slightly
March 10, 2015
February proved to be another good month for the state’s General Fund, as all three of the major taxes—personal income, sales and use, and corporation taxes—came in above recent estimates, according to a report out this morning from the State Controller’s Office.
The state’s fiscal position matters even more to counties this year than usual, since the state plans to pay a substantial portion of mandate debt to local agencies with revenues that come in above last summer’s estimates.
The Department of Finance makes official revenue and cashflow estimates a few times each year. One estimate accompanies the annual Budget Bill in June, then those numbers are updated when the Governor releases his new budget proposal in January.
The payment to counties for pre-2004 mandate debts will be determined after the Department updates its estimate in mid-May.
Compared to those January estimates, year-to-date personal income tax is up 1.3 percent, sales and use taxes are up 2.3 percent, and the corporation tax is up 1.9 percent.
However, compared to the estimates contained in the 2014-15 budget, personal income tax is up 6.9 percent, sales and use taxes are down 0.7 percent, and the always difficult-to-predict corporation tax is up 44.8 percent.
Aside from the concern for mandate debt payments, the most important of these revenues for counties is the sales and use tax since it funds 1991 realignment, 2011 realignment, and Proposition 172, as well as county transportation and the local Bradley-Burns.