Old News Is Bad News: Third Quarter Brings More Decline in Tax Revenues

Source: Lucy Dadayan and Donald J. Boyd, Nelson A. Rockefeller Institute of Government, State Revenue Flash Report, November 23, 2009

-Overall state tax revenues fell by 10.7 percent in the third quarter of 2009, compared to the same quarter a year earlier, based on preliminary data. All forty four early reporting states saw declines in collections.
– Personal income tax revenue showed the sharpest decline, with an 11.4 percent year-over-year decrease.
-Sales tax collections fell once again, by 8.2 percent during the quarter, while corporate tax collections dropped 19.4 percent.
– This is the fourth quarter in a row that revenues from two major sources–personal income tax and sales tax–declined on a year-over-year basis.
– States will likely face further revenue declines in the fourth quarter of 2009.

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