Tax Revenue Declines Across US

November 24, 2009 Taxation in USA  No comments

The Rockefeller Institute of Government published a report on November 23rd, showing that tax revenue has fallen across most US states.

According to data collected from 44 states, the total tax take in the US fell by 10.7% (or 11.3% if adjusted for inflation) in the third quarter of 2009, compared to the same quarter in 2008. In a cross-US measurement Corporate Income Tax was the most significant drop, being 19.4% less than the 2008 third quarter, Personal Income Tax fell by 11.4% and Sales Tax dropped by 8.2%.

Of the states investigated, only Massachusetts has reported growth in Sales Tax in the third quarter of 2009. Positive growth in Corporate Income Taxes was reported by the states of Maine, Vermont, Wisconsin, Louisiana, South Carolina and Tennessee. Although, if comparisons are drawn to the previous quarter of 2009, Personal Income Tax has grew by 16.1% in the third quarter and Sales Tax has risen by 1.3%, while Corporate Income Tax fell by 22.3%.

Regionally, the Southeast saw the lowest drop in tax revenue, compared to last year, with a total decrease of only 8.1% and the Southwest saw the biggest drop with 21.5%.

On a year-to-year basis, this is the fourth quarter with declines in Personal Income Tax and Sales Tax. The Rockefeller Institute predicts, within the report, that the October-December quarter will experience further levels of decline.

The state tax revenue report can be found on the Rockefeller Institute of Government website.

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