Sacramento Bee: Income tax decline hits California, other states hard

[marmar]

June 19, 2009
Income tax decline hits Cal, other states hard


California's general fund budget is dependent on personal income taxes for about half of its support, which is why it and other states with high dependence are feeling the nation's most severe budget pinches, a new study by the Nelson A. Rockefeller Government Institute reveals.

"The April 15 deadline for personal income tax returns brought very bad news for many states," says the report, called "April Is the Cruelest Month."

Overall, state income tax collections this year are running 27 percent below what they were a year ago, the Rockefeller survey found, although a few states actually reported increases.

California's income tax revenue decline, 33.8 percent, is the fourth highest in the nation but the other states reporting higher percentages - Arizona, South Carolina and Michigan - are much less dependent on income taxes. In Arizona, for instance, just a quarter of its general fund revenues come from the income tax.

When those two numbers are combined, the decline in income tax revenues means an overall revenue drop of 16 percent in California, one of the highest numbers in the nation. New York and Massachusetts are faring worse than California, as is Oregon, which has no sales tax and is dependent on income taxes for a whopping 68.5 percent of its revenues.

The full Rockefeller report is available here.



http://www.sacbee.com/static/weblogs/capitolalertlatest/023267.html

[KansDem]

1. Could this possibly be due to the Bush tax cuts and outsourcing?

Bush tax cuts for the wealthiest Americans according to the age-old canard that these folks would invest in American industries thereby creating jobs? Yeah, how well did that work out? Did we really believe capitalists have the welfare of average Americans at heart?
:rofl:

Instead they took their swag and hid it in overseas banks like Switzerland's UBS in order to avoid paying taxes.

And outsourced jobs took the tax base out of this country.

Hey, you want more?

[Auggie]

2. California is home to a lot of really high incomes

The money is there -- just have to ask for it. I'm amazed at how little even poor people like me have to pay in State income tax.

[Liberal_in_LA]

3. state income tax rising

[Johonny]

4. Arnolds advisors told him when he took office

to use his popularity to switch the state of income tax based funding of the state to funding that is more stable. But he choose to ignore that advice.

[Winterblues]

5. I would say in true GOP fashion that this calls for a "Tax Cut"

Oh and it is "Clinton's Fault"