New York State Comptroller Thomas DiNapoli issued a report saying revenues from all governmental fund tax collections for the past six months were $391.9 million short of projections. According to Mr. DiNapoli, the data showed a “continued need for caution this year and next” and the lagging tax revenues could have a big impact on Albany budget talks.
Tax revenues from April 1 through October 1, the first six months of New York State’s 2011-2012 fiscal year, were actually up 12.6 from the same period last year, but they were projected to be much higher in forecasts made as recently as August. Mr. DiNapoli blamed the shortfall on receipts from both income tax and consumption taxes coming in at lower than expected levels.
“Growth in revenue collections in several major categories of taxes is slowing, and at the midpoint of the fiscal year, Personal Income Tax, sales tax, and business taxes are lagging recent projections by $400 million,” Mr. DiNapoli said.
Mr. DiNapoli said the declining tax revenues could have an effect on planning for next year’s state budget.
“If these trends continue, the state may need to adjust its revenue projections downward. The Quick Start process in November, designed to jump-start 2012 budget talks, will be an opportunity for all parties to discuss and adjust revenue and spending projections to ensure we continue on a fiscally responsible path,” Mr. DiNapoli said.
Lawmakers in Albany approved this year’s $132.5 billion budget at the end of March. It was the first time state legislators agreed on a budget on schedule in five years.