Monday, September 26, 2005

I guess this is Bush's fault as well

posted by Rob at 4:25 PM

Since everything that happens is attributable to the man in the White House, should he get credit for the sudden surge in state tax revenue, as recorded by the Nelson A. Rockefeller Institute of Government.

Here's the summary:
- State tax revenue in the April-June 2005 quarter grew 13.3 percent compared
to the same period in 2004. This was the fastest growth since at least 1991.

- After adjusting for inflation and legislated tax changes, growth was 8.1 percent.

- All three major tax sources showed strong growth, with the strongest gains
recorded in the corporate income tax.

- Final personal income tax payments with returns were up 29.3 percent.

- Revenue growth was strongest in the Mid-Atlantic region (16 percent) and
weakest in the Great Lakes and Southwest regions (9.1 percent).

- National employment growth was 1.6 percent in the quarter, with the strongest
growth in the western and southern regions.
The full report is here (.pdf file).
So from where did this extra money come? Not where you think (emphasis mine):
Tax increases and other processing changes made a relatively minor contribution to state tax collections in the April-June quarter, and were concentrated in a few states. Without net enacted tax increases and processing changes, state tax revenue growth would have been 13 percent. Inflation, however, remained relatively high this quarter at 4.5 percent. If the effects of enacted tax increases and inflation are considered, real adjusted state tax revenue increased a strong 8.1 percent, as shown also in Table 1. This is the strongest quarter of real adjusted state tax revenue growth in seven years.
I admit, this is only for one quarter. Revenues could be way down for the next, especially considering the impact of Katrina and Rita. It'd be interesting to find out what's happening at the state level, and if there may be a corresponding trend at the national.


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