Latest news with #RevenueEstimatingConference
Yahoo
22-05-2025
- Business
- Yahoo
How much is in the state's checkbook? Some good news and uncertainty
BATON ROUGE, La. (Louisiana First) — Coming up with a definitive amount of money the state has to spend is often a moving target, but lawmakers feel they've come as close to a fiscal outlook as possible during a Revenue Estimating Conference at the State Capitol Wednesday. The commissioners and members met with economists who told them the estimate from December has increased slightly. That increase amounts to about $130 million more for the $12 billion general fund. Secretary of Revenue Richard Nelson appeared pleased with the forecast so far. 'It's about a hundred million, that's just kind of an adjustment based on how the collections are coming out, it's not that significant when you're looking at a $12 billion (general) fund, but at the end of the day it's moving in the right direction, I think with the sweeping changes you don't want to see it fall off, but you'll continue to see positive growth going forward,' said Nelson. But lawmakers at the conference were told the new tax code adopted last year during a special legislative session is still being analyzed. So the numbers could swing one way or another in the coming months. 'Right now, we are in the very early beginnings of this change in the tax code, and therefore my position is still kind of wait and see, we've had about three months of collections,' said Louisiana Chief Economist Manfred Dix. Some conference members were interested in how the forecast would be impacted by a national recession. Economists said that was not part of the calculations for the state's revenue estimate. What is a recession and is the US in one? West Baton Rouge school system breaks ground on school upgrades How much is in the state's checkbook? Some good news and uncertainty Two men arrested after separate deadly overdoses in Livingston Parish GOP leaders reveal changes to win over holdouts on Trump agenda bill GOP holdouts shift after Trump, Johnson offer assurances Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
20-05-2025
- Business
- Yahoo
What slowdown? RI revenues revised up $80M despite recession fears.
Despite concern that the national economy is at risk of a recession, Rhode Island revenue collections have been revised up nearly $80 million for this year and next, according to new projections from state fiscal analysts. The latest projections, released Friday, May 9, show state revenue for the year ending June exceeding expectations by $60.7 million. And they predict revenue in the fiscal year starting July 1 to be $19.3 million higher than they expected last November. The rosier-than-expected revenue forecast will take some pressure off House Democratic leaders writing a state budget for next year by eating into what had been a projected $250 million budget deficit. Despite state revenues continuing to climb, General Assembly leaders remained downbeat, at least in part to discourage their members from demanding lots of new state spending. "The revenue results preview the effects of the weakening U.S. economy linked to turmoil in Washington, D.C., House Speaker K. Joseph Shekarchi said in an email. "Any short-term positive news is overshadowed by the magnitude of that uncertainty and the many related or unsolved budget issues." New Senate President Valarie Lawson and Senate Finance Committee Chairman Louis DiPalma said: "While we are pleased that revenue and caseload estimates remain relatively stable compared to the estimates made in November, we are experiencing a more challenging budget, and more difficult choices, than in recent years." The new numbers from the twice-a-year Revenue Estimating Conference expect current-year revenue to reach $5.6 billion on increases in personal income tax, corporate tax, utility tax, insurance premium tax, cigarette tax, alcohol tax, estate tax and lottery profit. The major exceptions to the upward tax revisions were sales tax, which is now expected to come in $22 million short of the November estimate, and bank tax, which is now expected to come in $27.3 million short of the November estimate. It was not immediately clear how much of the decline in bank tax collections, if any, were the result of changes made by lawmakers last year to help keep Citizens Bank in Rhode Island. At the end of April, economists from Moody's Analytics told the Revenue Estimating Conference that they expect the economy to slow in the years ahead and unemployment to rise, but stopped short of predicting recession. Looking forward to next year, the revenue estimators predict collections of $5.7 billion on a modest increase in personal income tax, insurance tax and lottery collections. They expect sales tax to continue to slide back next year. This article originally appeared on The Providence Journal: What slowdown? RI revenues revised up $80M despite recession concerns Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
07-05-2025
- Business
- Yahoo
New Republican tax break won't paper over Iowa's unfair system of raising revenue
(Photo illustration by Kathie Obradovich/Iowa Capital Dispatch) Rest assured, Iowa. Republicans in Des Moines have heard your concerns about high prices, and they're doing something about it. Members of the Iowa House took the bold step recently of voting to eliminate the sales tax on toilet paper. This was such a high priority that Speaker Pat Grassley led the charge, along with nearly two dozen other members of the House GOP. The Senate and Gov. Kim Reynolds still must act before it becomes law, but judging by the non-partisan estimates, if all of them get on the same page, this will save every Iowan about $2.65 a year. Go to town, Iowa. Buy a couple of candy bars. To be fair, this isn't the only item Republicans want to shelter from the state sales tax this session. They're talking about adding laundry detergent, too. In all seriousness, I can see why Republicans might be eager to look like they're reducing the sales tax burden on Iowans. Public opinion polls say Americans are worried about high prices. Meanwhile, the tariffs President Trump is imposing have convinced people, correctly, that prices will go up even more. Still, Republicans in Iowa have more to be concerned about than just what their party's leader is doing to shrink American bank accounts. They've created problems of their own. Big shift in Iowa tax collections Over the past few years, the Iowa GOP has slashed personal and corporate income taxes that, historically, have taken a bigger percentage out of the incomes of the rich, even as they have collected more and more sales and use taxes, which exact a higher toll on low- and middle-income Iowans. Here's a good illustration. The March report by the state Revenue Estimating Conference on general fund revenues predicted that in fiscal year 2026, 55% of total tax receipts, or $5.6 billion, will come from personal and corporate income taxes. Meanwhile, 44%, or $4.4 billion, will come from sales and use taxes. (These figures don't include refunds, the vast majority of which are personal income tax refunds.) That's an extraordinary shift. In 2019, almost 63% of total tax receipts came from personal and corporate income taxes, while nearly 34% of the total came from sales and use taxes, a 29-point difference. That gap fell to 24 points in 2023. In 2026, the REC says, it will shrink to about 11 points. Percentage of Iowa's total tax receipts by fiscal year and tax type, not including refunds. (Data source: Revenue Estimating Conference reports on General Fund revenues. Graphic: Ed Tibbetts) This is an easy trend to miss. Republicans have made a big deal out of cutting income tax rates, and they get plenty of news coverage from it, too. Meanwhile, the state's sales and use tax rates have remained the same. But don't think the state isn't collecting more money every year just because those tax rates stayed the same. It clearly is. People are spending more money each year on goods and services, and they're paying more sales tax as a result. In addition, the Legislature expanded the sales tax, beginning in 2019, to include digital goods, subscription services and other online sales. This was no small tax increase. In fiscal year 2024, the state raised about $349 million from the tax on remote sales. Six years earlier, that number was zero. Meanwhile, the money the state is raising from the income tax is steadily declining. Between fiscal years 2023 and 2026, Iowa will collect nearly $1 billion less from personal and corporate income taxes, according to the Revenue Estimating Conference. At the same time, the state will raise almost $500 million more from sales and use taxes, the REC estimates. Again, the state is raising more money from the tax that hits low- and middle-income Iowans the hardest and less from the tax that traditionally has had a bigger impact on higher-income Iowans. Think of it this way: The sales tax on the $50 spent for clothes or dinner at a restaurant takes a bigger chunk out of the income of someone making $30,000 a year than it does from someone who's making $1 million. Last year, a study by the Institute on Taxation and Economic Policy said the 20% of Iowa households with the lowest incomes in the state paid 6.6% of their family incomes on sales and excise taxes. The top 1% only paid 1.1%. (Source: Institute on Taxation and Economic Policy) This should not be a surprise. The same principle is at work with Trump's tariffs. The tariffs, which are a sort of sales tax, will hit low-income families harder than the wealthy. A new study by ITEP said for households making less than $29,000 next year, Trump's tariffs will impose an additional 6.2% tax on them, according to CNBC. Households making more than $915,000 a year will also see an increase, but it will be much smaller—only 1.7% of their incomes. Meanwhile, those tariff revenues will undoubtedly backfill some—but certainly not all—of the revenue lost to the federal treasury by extending the Trump tax cuts, which favor the wealthy. Hedging their bets In Iowa, Republican lawmakers support their president. And they are working to permanently freeze the shift they've implemented in state tax collections. They've pressed forward with a proposed amendment to the Iowa Constitution that would require supermajorities in the state Legislature to raise the personal or corporate income tax. But not the sales tax. They purposely excluded this tax from their proposal. Why? I think it's because they're hedging their bets. Iowa Republicans already see that their income tax cuts have yielded a $900 million deficit for fiscal year 2026. They have suggested they'll use one-time reserve funds to close the deficit this year. But what about down the road? What happens if Iowa's economy hits the skids? Or if lawmakers find they can't squeeze public education budgets more than they have already? Or if the economy doesn't grow as much as they promised and state reserves drain faster than expected? If this constitutional amendment is approved by voters, it will be practically impossible to raise personal or corporate income taxes, even on the wealthy who have benefitted the most from the Republicans' new flat income tax. Which may leave them no alternative but to raise sales and use taxes. The trend here isn't hard to figure out. The state of Iowa is relying more on the taxes that hit low- and middle-income Iowans the hardest, even as they lean less on the tax that has traditionally taken more money from the wealthy. This is a big shift, and saving $2.65 on a year's supply of toilet paper does nothing to change that fact. This column was originally published by Ed Tibbetts' Along the Mississippi newsletter on Substack. It is republished here through the Iowa Writers' Collaborative. Editor's note: Please consider subscribing to the collaborative and the authors' blogs to support their work.
Yahoo
17-03-2025
- Business
- Yahoo
Florida's January unemployment rate at 3.5 Percent
Florida's unemployment rate had a slight uptick to 3.5 percent in January, while Gov. Ron DeSantis touted growth in the labor force. The state Department of Commerce on Monday released a report that said the January rate was up from 3.4 percent in December. It also was up from 3.2 percent in January 2024. The number of people qualified as unemployed increased from 385,000 in December to 390,000 in January. It was up from 353,000 in January 2024. Meanwhile, the labor force of 11.188 million in January increased by 18,000 from December and 66,000 from January 2024. DeSantis' office issued a release that said the expanded workforce reinforced 'the state's economic strength.' It said the 'state's labor force grew or remained stable in 10 of the past 12 months, underscoring Florida's sustained economic momentum.' 'Florida continues to prove that leadership and conservative fiscal policies drive success,' DeSantis said in a prepared statement. 'We will keep the momentum going by insisting on reducing government spending, continuing to eliminate bureaucracy, and finding more tax reductions for Floridians.' The national unemployment rate in February was 4.1 percent, up from 4 percent in January. Florida will release a February rate next week. The Florida unemployment report Monday came three days after a panel of economists known as the Revenue Estimating Conference released updated projections of state general revenue. While the projections were higher than had been anticipated in an August forecast, the panel cautioned about 'weaker' state and national economic variables and said the 'forecasting environment is considerably less stable over the short run than it was in the summer. Further economic uncertainty exists from this point forward.' Monday's report showed employment increases in categories such as education and health services and leisure and hospitality. Construction saw a decrease of 5,100 positions. Across Florida, the Miami-Fort Lauderdale-West Palm Beach metropolitan statistical area had the lowest unemployment rate in January at 3.0 percent, The Orlando-Kissimmee-Sanford and Crestview-Fort Walton Beach-Destin regions were next-lowest at 3.6 percent, while the Tallahassee area was at 3.7 percent The Naples-Marco Island, Jacksonville and Tampa-St. Petersburg-Clearwater areas were at 3.8 percent. The Cape Coral-Fort Myers, North Port-Bradenton-Sarasota, Palm Bay-Titusville-Melbourne, Panama City- Panama City Beach and Pensacola-Ferry Pass-Brent areas each had 4 percent rates. Meanwhile, The Villages area had the highest rate at 6.9 percent, followed by the Homosassa Springs area at 5.8 percent and the Sebring area at 5.6 percent. The statewide rate is seasonally adjusted, while the metro rates are not adjusted. Click here to download our free news, weather and smart TV apps. And click here to stream Channel 9 Eyewitness News live.
Yahoo
16-03-2025
- Business
- Yahoo
Florida revenue estimates up amid ‘uncertainty', according to economist
Florida economists Friday warned that 'uncertainty exists' as they increased general-revenue projections that lawmakers will use in negotiating a new state budget. A panel of economists known as the Revenue Estimating Conference updated general-revenue projections, which were last issued in August, by about $1.3 billion for the current fiscal year and next year. But in an executive summary of its report, the panel pointed to 'weaker' state and national economic variables and said the 'forecasting environment is considerably less stable over the short run than it was in the summer. Further economic uncertainty exists from this point forward.' Economist Amy Baker, coordinator of the Legislature's Office of Economic & Demographic Research, said the new revenue forecast comes with 'a strong caveat' that the 'greatest risks going forward are all to the downside.' 'There's a lot of uncertainty on how things are going to unfold, both at the federal level, and that includes not only new policies that are being put into place, but also, what is the Federal Reserve going to do next,' Baker said. The Revenue Estimating Conference meets periodically throughout the year to update projections of general revenue, which includes such things as sales taxes and plays a critical role in funding schools, health programs and prisons. Lawmakers will use Friday's estimates in crafting the fiscal year 2025-2026 budget, which will take effect July 1. Legislative leaders have repeatedly said spending in the budget won't be as robust in past years, in part because federal COVID-19 pandemic money is no longer available. In August, Baker said some economic uncertainty remained about consumer saving levels and global issues, such as conflicts in the Middle East that could have a spillover effect on oil and gas prices. Now, concerns include the Trump administration's decisions to cut government operations and impose tariffs on traditional trading partners. The state economists added $768.3 million to projected revenue for the current fiscal year, which started July 1, and $503.5 million for the 2025-2026 fiscal year. The gains are based on sales-tax revenue that has mostly come in higher than anticipated in August and higher-than-expected earnings on state investments. 'I think uncertainty in and of itself causes people to, you know, kind of hunker down,' Baker said. 'In addition to that, you know a lot of folks have money that's at least tangentially in the stock market. Retirement bonds, 401(k)s. So, they watch those balances. They feel those balances coming down. They know that it's a time of uncertainty. They feel less wealthy. They feel less better off as a result of that.' The sales-tax estimate was increased by $510 million for this fiscal year. An increase of $385.4 million was added to the forecast for 2025-2026. Meanwhile, projected revenue from corporate income taxes faced the biggest reduction --- $221.8 million --- over the two years. The state's figures, in part, reflected survey numbers by the University of Michigan, which on Friday indicated national consumer sentiment reached its lowest reading in over two years. 'The sentiment numbers are the latest sign of worry caused by (President Donald) Trump's trade wars alongside sustained drops in the stock market as investors react to the fallout from higher tariffs on China, Mexico and Canada, and on steel and aluminum from U.S. allies,' Joanne Hsu, director of the survey, said in a news release. 'There's also the prospect of more duties on countries across the globe.' Last week, the University of Florida's Bureau of Economic and Business Research found a 'sharp' decline in consumer confidence among Floridians after three consecutive months of increases following the November presidential election. Click here to download our free news, weather and smart TV apps. And click here to stream Channel 9 Eyewitness News live.
