The monthly revenue collection has topped that of a year ago for the third consecutive month.
The reasons for this improved performance in collection vary from month to month, but one common denominator is the Aug. 1 change in the sales tax rate from 5 percent to 6.25 percent.
December 2009 revenues totaled $1.885 billion, up $22 million or 1.2 percent from December 2008, according to the revenue numbers DOR released yesterday. Similarly, November revenues and October revenues topped collections for the same months in 2008.
The first three months of FY10 (July, August and September) saw monthly collections fall short of those from a year ago, which is one reason why the FY10 revenue estimate was adjusted downward by $600 million in mid-October to $18.279 billion.
However, based on the past three months performance both in terms of surpassing last year's monthly collections and in terms of beating revised benchmarks, the FY10 revenue estimate was revised yesterday to $18.460 billion, an increase of $181 million.
Sales tax revenue for December 2009 was $377 million, up $71 million from a year ago, an increase of 23.4 percent and $14 million over benchmark. Had there been no sales tax rate increase, the collection would have been 3.9 percent less than a year ago. Year-to-date, sales tax collection is $2.231 billion, up $227 million or 11.3 percent. Again, had there been no sales tax rate increase, the collection for the first six months of FY10 would have been 7.0 percent less than a year ago, which is in line with other states.
Click here for a closer look at the numbers behind the December figures.
And for overviews of how states throughout the nation are dealing with their fiscal issues, click here and here Massachusetts continues to face an estimated $3 billion budget gap in FY11, which begins July 1, 2010. Governor Patrick will release his proposed FY11 budget later this month.