DOR today released the September revenue report, which showed overall tax collections coming in $243 million below the projected collection or what is commonly referred to as the benchmark collection.
For the year-to-date, state tax collection is $212 million below benchmark. As a result, the Governor today announced that his cabinet would continue to plan for budget reductions, while, at the same time, outside economic forecasters will take a fresh look at state and national revenue trends with an eye toward revising downward by October 15 the current revenue estimate for this fiscal year of $18.879 billion.
Once the estimate is revised, budget cuts will be announced the follow week, no later than October 22.
During the fiscal year that ended June 30, the state knocked down its revenue estimate four different times. By the end of the year, the actual collection was $3.2 billion less than had been projected on July 1, 2008. So this trend is continuing without abatement.
Massachusetts is hardly alone in dealing with the impact of this severe economic downturn on state revenues. Already this fiscal year, half the states have lowered their original revenue estimates, and 48 states are reporting revenues falling below projections.
Economists are starting to see signs of economic revival in the private sector, but there is historically a lag between what happens in the private economy and what is happening to tax revenues. For instance, by December 2007 it was apparent to many observers that the national economy was starting to fail, but the decline in revenues did not materialize in Massachusetts until a year ago, in September 2008.
DOR Ruling Favorable in First Circuit Judgment posted on Mar 17
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Five Reasons to E-File with DOR’s WebFile for Income posted on Feb 24
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Class in Session at DOR University posted on Jan 20
Looking to educate yourself this tax season? Want to learn more about tax options, or DOR-related issues? All this can be achieved at DOR University, the Department of Revenue’s free online e-learning module. DOR University, created to offer free tax education to the public and …Continue Reading Class in Session at DOR University