After Disastrous 2009, States Report Modest Revenue Growth in Early 2010
- State tax revenues grew by 2.5 percent in the first quarter of 2010, marking the first time that statesreported growth in collections on a year-over-year basis since the third quarter of 2008. Thirty-three states reported total tax revenue declines during the first quarter, with five states reporting doubledigit declines.
- The growth in state tax revenues is not an indication of broad state fiscal recovery, but is mostly driven by legislated changes in two states — California and New York.
- State tax revenues are still below the prerecession levels, showing a decline of 9.3 percent in the first quarter of2010 compared to the same period two years earlier.
- Personal income tax revenue increased by 2.5 percent and sales tax increased by 0.4 percent for the nation. Preliminary figures for April and May for 42 early reporting states indicate that the second quarter of 2010 will be weaker than the first quarter, with collections so far showing an uptick of less than 1 percent.
- Local tax revenue declined 1.1 percent, mostly driven by declines in property tax and corporate income tax collections.
