States’ overall tax revenues rose in the first quarter of calendar 2010 on a year-over-year basis, marking the first such gain since the third quarter of 2008, according to preliminary data in a new report from the Rockefeller Institute of Government.
Despite the overall growth in revenues, however, a majority of states still saw declines, according to Institute Senior Policy Analyst Lucy Dadayan, the report’s author. The increase in total collections was mostly attributable to revenue growth driven by legislated tax increases in just two states — New York and California. If those two states are removed from the calculations, total collections across the nation show a 2.2 percent decline in the first quarter of 2010. And even with the boost from those two states, overall revenues remain significantly below pre-recession levels.
Further, early indications of revenues in the April-June quarter — marking the end of the fiscal year for 46 states — are not promising, as the important April collections from income taxes showed a 7.6 percent year-over-year decline.
For the full report, visit the Institute’s Web site. The report was covered this morning in The New York Times.