US States On Track to Tax Revenue Recovery
February 2, 2011 Taxation in USA
US state tax revenues are displaying continued growth and new indications that overall collection levels will soon exceed those seen two years ago.
On February 1st the Nelson A. Rockefeller Institute of Government released the latest edition of its quarterly State Revenue Report, showing a continued recovery in US state tax revenues. According to the publication, throughout the July to September quarter of 2010, the US experienced the third consecutive period of tax revenue growth, reported to have been 4.7 percent when compared to the same period in 2009. However, state tax revenues are still 7.5 percent below levels seen in the same period in 2008.
Across the US personal income tax and general sales tax revenues were both shown to have risen by 4.3 percent, while corporate income tax was 1.6 percent. This is the first period since the second quarter of 2007 that all three indicators have grown at the same time.
On a regional level, only seven states reported overall drops in tax revenue levels in the third quarter. Alaska experienced the biggest decline, at a level of 37.8 percent, followed by Hawaii, with 12 percent. The only other states to show revenue drops were Nevada, Wyoming, Virginia, Louisiana and New Jersey. New Hampshire and North Dakota underwent the largest growth levels, at 29.9 percent and 29.8 percent respectively.
Preliminary data concerning states’ tax revenues for the fourth quarter of 2010 indicated that overall collections continued to grow throughout the year. According to the early estimates, tax receipts in the fourth quarter may have grown by 6.9 percent. The increase represents the highest growth levels seen throughout the year.
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