More Good Budget News

The Horseshoe, as insiders call the governor’s office, has to be happy.  So does the Legislature. 

With one more day to go, personal income tax collections for April stand at $12.6 billion — $500 million more than the Schwarzenegger administration predicted in the governor’s January budget plan. 

Although the better-than-anticipated receipts won’t erase the state budget’s $7.4 billion gap between revenue and spending commitments, the additional cash will cause that fiscal hole to not grow as much as budget analysts previously expected. 

Based on year-to-date cash receipts and California’s sluggish economy, both Schwarzenegger and the Legislative Analyst have said that the $7.4 billion will balloon to a larger number. Some observers have suggested the hole the shortfall will grow to at least $10 billion; others say even higher.   

The solid collections for April mean the budget gap won’t be as high as it otherwise would have which should help lawmakers and the GOP governor find a budget compromise sooner. 

The Franchise Tax Board posted $1.4 billion today (Tuesday April 29) in income tax revenue after reporting a record $2.8 billion on Monday after a weekend of counting returns. 

In other good news, while the past two days have seen revenue collections jump by $4.2 billion, refunds have stayed flat at $1.9 billion for the month.

(See post below for more.)

 

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