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State income tax revenue runneth over
Sacramento Bee ^ | 5/3/6 | Clea Benson

Posted on 05/03/2006 8:02:08 AM PDT by SmithL

The state is collecting record-breaking tax revenues this year, outstripping even the most optimistic fiscal forecasts and setting the stage for a debate among lawmakers over what to do with the bounty as they craft next year's budget.

The Franchise Tax Board said it took in $11.3 billion in personal income tax payments this April, an amount larger than the $10.5 billion the state received in April 2001 at the height of the high-tech stock market boom.

The pace of revenues is amazing even the experts who make a living predicting how much the state will earn.

"We're very surprised by the strength," said Brad Williams, director of fiscal forecasting in the Legislative Analyst's Office, the Legislature's nonpartisan budget adviser. "The numbers we saw in April were extraordinary, way above expectations."

Experts in Williams' office and at the Department of Finance are scrambling to come up with an explanation for the dramatic increase in state income, up 40 percent over last April, before lawmakers begin to deliberate over the budget for the fiscal year that begins July 1.

No single factor - the stock market, real-estate deals, or business growth - seems to explain it, Williams said.

And with Gov. Arnold Schwarzenegger due to come out this month with an updated version of next year's budget, policymakers will need to know whether to view the new money as a one-time bonanza or as a dependable stream of income that could continue into the future.

No matter what the reason, officials at the Department of Finance say the state could end up with about $4 billion more in its bank accounts this year than the governor predicted in January when he released his proposed $125.6 billion spending plan for the 2006-07 fiscal year.

(Excerpt) Read more at sacbee.com ...


TOPICS: Constitution/Conservatism; Culture/Society; Front Page News; Government; News/Current Events; Politics/Elections; US: California
KEYWORDS: california; taxtaxtaxtaxtaxtax

John Laird, chairman of the Assembly budget committee, said the increased revenue is just about enough to cover all of those expenses that were not included in the governor's January spending proposal, plus a few other things that Democrats want.
1 posted on 05/03/2006 8:02:10 AM PDT by SmithL
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Just like every other time California politicians get a few extra dollars, they'll use the money as a down-payment on big-ticket items.


2 posted on 05/03/2006 8:03:29 AM PDT by SmithL (Sarchasm: The gulf between the author of sarcastic wit and the person who doesn't get it.)
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To: SmithL

Damn those tax cuts for the rich. ;-)


3 posted on 05/03/2006 8:05:05 AM PDT by rhombus
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To: SmithL
The pace of revenues is amazing even the experts who make a living predicting how much the state will earn.

Earn?

4 posted on 05/03/2006 8:07:23 AM PDT by rhombus
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To: SmithL
setting the stage for a debate among lawmakers over what to do with the bounty

How about give it back to the people it belongs to?

5 posted on 05/03/2006 8:09:24 AM PDT by 11Bush
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To: rhombus

The pace of revenues is amazing even the experts who make a living predicting how much the state will earn confiscate.

Fixed.

6 posted on 05/03/2006 8:09:30 AM PDT by Libertarian444
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To: SmithL
$4 BILLION IN BANK ACCOUNTS!!! FOUR BILLION OF OUR DOLLARS MAKING DOLLARS FOR LIBERAL RINOCRATS AND SOCIALIST DEMOCRATS TO SPEND!!! SPEND!!! SPEND!!! THAT MONEY SHOULD BE RETURED TO THE RIGHTFUL OWNERS FROM WHICH IT WAS CONFISCATED!!! THE DAMNED GOVERNMENT IS NOT A BUSINESS, NOT IN THE BUSINESS OF MAKING MONEY. THEY ARE SUPPOSE TO ONLY GET WHAT IS NECESARY TO RUN THE STINKING GOVERNMENT FOR THE YEAR, NOT STOCK PILE MONEY TO BUY MORE VOTES ON. I think it is time for another American Revolution and take back the Republic from the stinking politicians.
7 posted on 05/03/2006 8:13:00 AM PDT by RetiredArmy (Politicians and the U.S. Government are liars, cheats and thieves, in it for their own gain.)
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Comment #8 Removed by Moderator

To: SmithL
I read this article with great interest. For the first time, I owed more in CA state taxes than federal. Usually, when I've owed state taxes, it's a very small amount compared to the feds. This year, CA state taxes were 3x the fed amount.

Has anyone else in CA had this experience? I wondered if they changed the tax code, but the article makes me wonder. If the code was changed to get more taxes, there wouldn't be surprise at the FTB.
9 posted on 05/03/2006 8:15:09 AM PDT by UlmoLordOfWaters
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To: DamonSt
In the words of the Great One, Ronald Reagan: We start bombing when this news conference ends (or something like that!) I only wish we had enough people in the Republic that actually cared what happened to the country. But, when it comes to defending the Republic, I am afraid that the numbers who care are vastly outnumbered by the ESPN, talk show, American Idiot, Offpra watching types. If it does not up set their TV time and pizza delivery while watching, they don't care. The Republic is in a sad state of affairs. A group of less than 5% are running the entire show while the other 95% watch TV and don't care. Stop the planet, I want to get off in 1800 or so. When people cared.
10 posted on 05/03/2006 8:21:20 AM PDT by RetiredArmy (Politicians and the U.S. Government are liars, cheats and thieves, in it for their own gain.)
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To: UlmoLordOfWaters
This year, CA state taxes were 3x the fed amount.

That's really weird, because we know that CA state tax is based upon your federal (that's why when you file, you attach a copy of your federal return).

I'm not current anymore, but I believe California's top rate is something like 11 percent; much less than the Fed.

Could your situation be as it is because you got a very large state refund last year (making it state taxable income this year)?

11 posted on 05/03/2006 8:22:40 AM PDT by ErnBatavia (Meep Meep)
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To: SmithL

So to those who want to bash our Governator... Shut up!

Apparently he IS doing a good job in spite of the Socialists
in Sacramento and the 9th Circuit Court of Appeals.


12 posted on 05/03/2006 8:31:47 AM PDT by Jo Nuvark ((Those who bless Israel will be blessed, those who curse Israel will be cursed. Gen 12:3))
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To: SmithL

Oh they have to be kidding - sales tax and 7.5% on FUEL that might explain where the boost is coming from - do you really think they can't tell where the increase is coming from???

But boy would the s--t hit the fan if they made it public - infact you can expect to see the same kind of windfall for every state that has a sales tax on fuel.

Duh


13 posted on 05/03/2006 8:32:32 AM PDT by kentj
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To: ErnBatavia

I thought it was strange, too. I didn't get a refund last year, but paid a small amount. My parents had the same thing happen to them this year.


14 posted on 05/03/2006 8:35:01 AM PDT by UlmoLordOfWaters
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To: RetiredArmy

I agree. This country is full of lazy, fat-headed unintelligent slobs. The remainder are psycho socialists or foreign immigrants. This country doesen't have a chance in hell. I'm going to Alaska and pushing for secession :-)


15 posted on 05/03/2006 8:35:46 AM PDT by ChinaThreat (s)
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To: kentj

I'm sure the sales tax on Gasoline had something to do with it, as well as some sales of homes (not "real estate deals" but people who have lived in California for 20-30 years and paid $10,000 for their home, sold it for $1.4 million... hard to hide all that profit from the taxman, for a common person who doesn't hide millions of dollars all the time.


16 posted on 05/03/2006 8:44:02 AM PDT by monkeyshine
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To: Jo Nuvark

it is sales tax on gas and real estate prices it is they that get the credit are you sure you want give the credit to the Guvanator?


17 posted on 05/03/2006 8:56:53 AM PDT by kentj
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To: SmithL

I know.

Let's spend it!

---

The Gub and crew will make a token payment to paydown debt (if they have a clue) and blow the rest on a PR campaign to curry the teachers unions and parents favor in the upcoming election; i.e., by paying them their "owed" money..


18 posted on 05/03/2006 9:14:06 AM PDT by NormsRevenge (Semper Fi)
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To: SmithL

Well, so is Arizona's. But do you think Sassy Nappy would refund anything or put it in an emergency fund? No, the money-monger will probably pour the money into some useless welfare merry-go-round...


19 posted on 05/03/2006 10:35:35 AM PDT by Mrs. Darla Ruth Schwerin
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To: ChinaThreat

Yell when you are packed and swing by WA state, I'll tag along.


20 posted on 05/03/2006 10:37:59 AM PDT by RetiredArmy (Politicians and the U.S. Government are liars, cheats and thieves, in it for their own gain.)
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To: kentj

I think Sacramento is to Swartzeneger as
DC is to Bush. Very hard for good leaders
to get anything accomplished.


21 posted on 05/03/2006 11:28:45 AM PDT by Jo Nuvark ((Those who bless Israel will be blessed, those who curse Israel will be cursed. Gen 12:3))
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