Up or down?

The Office of State Finance today released General Revenue collections for July, the first month of FY ’12. Total collections were $385.0 million, which was $14.9 million, or 4.0 percent above July 2010, and $17.0 million, or 4.6 percent, above the certified estimate for the month. State Finance Director Preston Doerflinger noted:

While there was moderate growth in receipts, collections dipped from the overall double-digit growth rate for FY-2011.

While revenues continue to recover from their sharp decline during the downturn, the recovery remains only partial, as can be seen from this table:

FY ’12 collections remain 15.8 percent below their pre-downturn heights and have barely recovered to the levels of six years ago.

Of particular concern are personal income tax collections. GR collections from the personal income tax last month were just $130.6 million, slightly lower than last year and the lowest July amount for the tax since FY ’03. This reinforces the idea that the state labor market remains weak, despite the drop in the state official unemployment rate, while also pointing to the toll that tax cuts and tax credits continue to take on the personal income tax. At the same time, July sales tax collections reached an all-time high.