Tax revenue for the first nine months of the 2021-22 state fiscal year (SFY) continues to beat projections, totaling $84.4 billion. This amount is significantly higher than the most recent estimate of the Budget Division contained in the six-monthly update of the financial plan. While tax revenue has exceeded forecasts throughout the current fiscal year, the December results are also affected by a newly established tax structure, the Passage Entity Tax (PTET). The TFWP allows certain taxpayers to make state corporation tax payments that are federal tax deductible, rather than making state income tax payments that are not tax deductible federal.
Tax revenue exceeded the latest fiscal plan forecast by $12.9 billion in the first nine months of the 2021-22 fiscal year, according to the monthly state cash report released by the state comptroller. of New York, Thomas P. DiNapoli. This includes the $10.2 billion collected from the TFWP. However, taxpayers making TFW payments should reduce their personal income tax (PIT) payments by similar amounts. Since the December results may not yet reflect these offsetting reductions in PPI revenue, they should be viewed with great caution during this transition period.
“Tax collections performed well in December, and the economy and state finances continue to recover,” DiNapoli said. “But there is continued uncertainty about the impact of the current COVID-19 surge, economic risks and the need for continued financial support for those still struggling to find their footing. Additionally, December tax revenue was heavily impacted by the new tax structure created to mitigate the adverse impact of the 2017 federal cap on local and state taxes, which is clouding our revenue picture during this transition period. As we begin the new budget season, I urge the executive and legislature to proceed with caution.
IRP revenue totaled $49 billion and continued to exceed fiscal plan expectations ($1.9 billion over most recent projections and $7.1 billion over initial projections) and post year-over-year growth ($12.2 billion year-to-date). Withholdings totaled $34.7 billion, 18.8% higher than last year, benefiting from an additional withholding day, as well as the continued benefit of higher tax rates. ‘taxation.
Year-to-date, consumption and use tax collections totaled $14.8 billion, up 23.1% or $2.8 billion from the same period l year, and $386.2 million more than last projected, but $1.1 billion more than originally projected.
Business taxes totaled $18.3 billion, including $10.2 billion from the TFWP. Excluding this new source of revenue, business taxes were just $2 billion higher than a year ago for the same period and $217.7 million higher than the last projection and almost $1.5 billion more than originally planned.
All fund spending through Dec. 31 totaled just under $141.5 billion, or $14.3 billion, or 11.2%, more than the same period last year, mostly due to rising Medicaid and education costs. Spending by all funds in the first three quarters was nearly $4.5 billion lower than last projection and $5.9 billion lower than adopted projection, primarily due to lower-than-expected general fund spending and federal funds. State operating fund spending totaled $73.9 billion, up $10 billion or 15.7%, higher than last year and $1.7 billion lower than last projection .
The state’s general fund ended the third quarter with a balance of $30.7 billion, $15.2 billion more than last projected and $14.1 billion more than a year ago at the same period primarily due to the TFWP, as well as higher than expected tax recoveries and lower than planned expenditures.
December cash report
Enacted Budget Financial Plan Report, State Fiscal Year 2021-22
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