It’s been a heady ride for California finances in recent years, with budget revenue outpacing estimates by billions of dollars, buoyed along by the state’s healthy economic growth in 2015.
Could that trend be coming to an end?
Preliminary tax revenue for January stands at a net $167 million less than estimates in Gov. Jerry Brown’s proposed budget, according to a report Wednesday by the Legislature’s non-partisan fiscal analyst.
Income taxes came in $260 million less than budget estimates, preliminary numbers show, with corporation tax revenue $93 million above estimates. The income tax dip likely reflects a modest slowdown in economic growth and the lackluster stock market, the Legislative Analyst’s Office reported.
“Five months of 2015-16 income tax collections remain, including the key income tax months of April and June,” the LAO writes. But “the possibility now exists for some revenue deterioration between now and the May Revision.
“Our biggest concern is that continued stock market weakness could affect (personal income tax) taxpayers’ first two quarterly estimated payments for 2016 in April and June,” it concluded.