4/02/2012

Big tax increases in a few states doesn't seem to have closed deficits

The six states with the biggest increases in taxes in 2009 were Delaware, California, Illinois, New York, Rhode Island, and West Virginia.  From Fox Business:

In 2010, California, Illinois, New York and Rhode Island, all of which increased revenue from taxes by over 9%, had among the highest deficits, exceeding 30% of general funds. California faced a gap of more than 50%, second only to Arizona. Despite cutting spending and increasing tax revenue, many of these states have continued to experience major shortfalls. Projected budget deficits for California, New York and Illinois remain among the highest in the country. . . . .

California for 2012
The State ended last fiscal year with a cash deficit of $8.2 billion. The combined current-year cash deficit stands at $21.6 billion.  Those deficits are being covered with $15.2 billion of internal borrowing (temporary loans from special funds) and $6.4 billion of external borrowing. 

Illinois for 2012
The Institute for Illinois’ Fiscal Sustainability at the Civic Federation released its analysis of the enacted FY2012 State budget today. The report found that the spending plan will increase Illinois’ total general operating deficit to $5.0 billion by June 2012. . . .

New York was expected to still have a large deficit, but it had to raise yet more taxes.
The budget closes what was once a $3.5 billion deficit, a process made easier when lawmakers in December approved a Cuomo- backed tax increase on joint earners making at least $2 million annually. That lowered the gap to $2 billion. The remaining savings were reached mostly by consolidating agencies. . . . 
Rhode Island
Although Rhode Island’s economy is beginning to recover after multiple years of economic distress the House Fiscal Staff estimate a FY 2012 budget shortfall of roughly $300 million, which is projected to grow to approximately $375 million by FY 2016. . . . 

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1 Comments:

Blogger economist pilot said...

John,

When you indicate the deficit that a state government is running ... can you also include the actual tax collections and the actual spending ... for example, California was spending $100 Billion but only taking in $90 Billion ... and that was before the economy tanked. My recollection is that after the economy declined, California was still spending $100 Billion, but their collections dropped to $80 Billion and then to $70 Billion. NYC, NYS and NJ consistently have had budgets that were 10% higher than collections. It would be a wonderful exercise in transparency to post each state's thee-year revenues and expenses, as if it was a corporation with a ticker symbol and giving up their data on Yahoo Finance, just as BP has to.

Best Regards,

Al Masetti almasetti@gmail.com

4/02/2012 7:18 PM  

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