« Evers Warns Agencies to Avoid Additional Spending in 2023-25 Budget Requests | Home | Nicholson Drops Out of Governor’s Race »
State Tax Collections Running Ahead of Projections
By Dee Pettack | June 28, 2022
From WisPolitics.com …Tax collections for the fiscal year that ends this month are running ahead of projections, putting the state in line for another boost to the general fund.The Department of Revenue last week reported general fund tax collections through the end of May were up 5.2 percent compared to the same period a year earlier. The Legislative Fiscal Bureau had projected general fund tax collections would drop by 3.2 percent for the fiscal year that ends June 30.LFB Director Bob Lang today noted corporations make their estimated tax payments largely in four months, including June. Through the end of May, the state had collected $2.4 billion in corporate taxes. That matches what LFB projected in January the state would take in for the full 12-month period.“I think we’ve got a lot of strength (in collections), in corporate in particular,” Lang said.The state’s largest three general fund taxes are individual income, sales and corporate. Lang said income and sales also look strong.In January, the LFB upped its projected surplus for the 2021-23 budget to $3.8 billion, nearly $2.9 billion more than what it had expected when the budget was signed last summer.The Republican co-chairs of the Joint Finance Committee urged a cautious approach if collections come in above projections.Rep. Mark Born, R-Beaver Dam, said taxes on businesses and consumers are higher due to inflation. Meanwhile, Sen. Howard Marklein, R-Spring Green, also stressed that sales tax collections are strong, in part, because prices are higher due to inflation.He warned there are “lots of clouds on the horizon” with the possibility of an economic slowdown.“I think we need to be cautious about spending it,” Marklein said. “I think a year from now when we’re wrapping up our budget, I think we’re going to be glad that we’ve got the resources.”The LFB will issue a summary later this summer on preliminary tax collections for the full fiscal year, which ends June 30. The Evers administration will then do a look at tax collections in November, when it releases a preliminary projection for the 2023-25 biennium. The LFB will do its next look at revenues two months later in January.Lang noted there’s some uncertainty over the second year of the 2021-23 biennium between inflation, rising interest rates and the possibility of a recession.See last week’s DOR report here.
Topics: SAA Capitol Reports, SAA Capitol Reports with Email Notifications, SAA Latest Update | No Comments »
Comments are closed.