State finances appear to be in good shape, going by Comptroller Thomas P. DiNapoli’s monthly report for June.
Revenues from income taxes and business taxes were both down from a year ago, but the general-fund balance is better than anticipated.
The robustness of the general fund is a tipoff that the economy is growing, and that is a trend that should delight everyone. What that could mean is that the state’s revenue needs could be met without fear of new taxes and fees or an increase in taxation of any kind.
However, as the general fund is enhanced, the government must be sure to not continue to collect more than is absolutely necessary to provide for the public’s needs. As the economy thrives and tax collections increase, the government must be willing to scale back on the burden each citizen must bear.
Gross income-tax receipts in June rose from a year ago, a news release from DiNapoli’s office specifies, but an increase in tax refunds contributed to a $21.8 million decline in net receipts. Business-tax collections during June fell $97.2 million from a year earlier, largely because of a drop in bank taxes.
“State finances are stronger than we’ve seen in a while,” DiNapoli said in the news release. “We are seeing positive signs on the revenue side of the ledger as sales-tax collections continue to show growth. The economy seems to be gaining momentum, but there is also uncertainty, which demonstrates the ongoing need to be cautious.”
Miscellaneous receipts totaled $2.1 billion in June, $186.9 million higher than collections from last June. This includes a $250 million settlement from Bank of Tokyo Mitsubishi UFJ, which was not projected in the budget, and a $250 million transfer from the State Insurance Fund.
Partly offsetting the new revenue was a decline in bond proceeds from $132.3 million to $84.6 million. This decline is attributable to miscellaneous receipts being $305.2 million lower than projections in capital projects funds through June 30.