Posted on 03/31/2006 10:30:30 PM PST by NormsRevenge
WASHINGTON - State tax receipts jumped nearly 10 percent last year as a strong national economy increased individual earnings and corporate profits.
Most states showed increases without raising tax rates, meaning the gains were caused primarily by an expanding economy, said Corina Eckl, fiscal program director for the National Conference of State Legislatures.
"It's absolutely attributable to an improving national economy," Eckl said. "Very few, very modest tax changes happened last year."
Nationally, states collected a total of $649 billion in taxes in the 2005 budget year, which ended in June for most states, according to a report Thursday by the Census Bureau.
That's $2,192 per person.
The numbers include only taxes collected by states. They do not include federal or local taxes, which can greatly increase a person's taxes.
California collected the most money, more than $98 billion.
Vermont collected the most per person, $3,600.
South Dakota collected the least overall, at a little more than $1 billion, and the least per person, $1,430.
States get nearly half their tax revenue from sales taxes, which went up 6 percent from 2004 to 2005. Individual income taxes increased by nearly 13 percent, and corporate income taxes shot up 28 percent. However, corporate taxes account for little state revenue, about 6 percent, nationally.
"Individual income taxes are the big driver," said Chris Edwards, director of tax policy at the Cato Institute, a Washington think tank. "The stock market is up and people are earning more money."
Eckl said states also were helped by a two-year, $20 billion package of federal aid to states approved in 2003. The money helped states overcome budget shortfalls stemming from the economic downturn earlier in the decade, she said.
Eckl said most state budgets have recovered after several years of budget shortfalls. States across the country had to cut programs, increase tax rates and scramble for quick budget fixes after the national economy slumped earlier in the decade.
Today, many states are expanding programs, putting money away for later or considering tax cuts, Eckl said.
Every state but Vermont has a constitutional requirement to balance its budget, which leads many states to save money as insurance against future downturns.
All states collected more taxes in 2005 than they did in 2004. And every state but one collected more per person. The remaining state, New Hampshire, collected the same both years, $1,544.
Nationally, changes in state tax laws accounted for less than 1 percent of increased tax revenue, said Bert Waisanen, a fiscal analyst at the National Conference of State Legislatures.
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On the Net:
Census Bureau, state tax collections: http://www.census.gov/govs/www/statetax.html
Any state charging sales taxes on gasoline, got a huge windfall in the last couple years.
What this country needs are more unemployed politicians.
you trying to get us banned or something ? lol
btw, I support the complete elimination of the capital gains and inheritance taxes myself.
just think of all the revenue that might generate.
How can it be that states are taking in more taxes when illegals are stealing all the good jobs and they don't pay taxes?
It's one of the mysteries and beautious things about a free market economy.
Overall, Illegals are a net negative and even tho they are not taking away the highestpaying jobs imo,, they still do siphon off a good sized chunk nonetheless, but the overall scale of the economy is such that it can still grow regardless how many factors would appear to be slowing it down or bleeding it.
It speaks to the economic strengths that have gotten this country this far. How much longer this will remain to be the case is the unknown, however.
Imagine what it would be doing growth-wise if it hadn't sacrificed so much for other regions of the world as part of the "free trade" agreements of the last 20 years?
That should stimulate some interesting thought and comment.
.. or not.
"Every state but Vermont has a constitutional requirement to balance its budget"
Could it be that this is what has driven our economic burst?
Hence the reason the Fed is doing away with the tracking of M3 growth. They don't want you to know that our Federal deficit is doing far more to stimulate growth overseas than here. Law #1 of tyrannical rule... eliminate transparency.
Sorry but you are right on with capital gains and inheritance taxes
"Vermont collected the most per person, $3,600."
Seems very high. Wonder what the per capita income is for Vermont.
" State tax receipts jumped nearly 10 percent last year as a strong national economy increased individual earnings and corporate profits."
Mr.rat, Mr. rat how can this be Mr.rat? I don't understand. You keeping telling us we're in the worst economy since the first Columbus Day, so how can this be? You won't lie to us Mr. rat would you?
I would like to see more analysis. I wonder if illegals are part of economic activity that otherwise would not happen. I am dubious when I hear the assertion that they pay taxes. They may pay some sales taxes, but that is it. They avoid even that, here, by trading at flea markets. I suspect that there are unemployed Americans in different places than the illegals. If we shut them down, some business would stop, ie MW meat packing.
There it is. Pro-growth economic policies invariably also produce more government revenue.
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