Revised California Tax Projections Could Squeeze Budget
Sacramento, CA — California lawmakers approved a record $308 billion spending plan this year based on expectations of a very strong economy.
The budget anticipates that revenues that will be collected this year from sales, income and corporate taxes will total $ 210 billion. However, a new report from the non-partisan California Legislative Analyst says there is a 70-percent chance that tax revenue will fall below the projections, likely about $ 5 billion short.
Budget projections regularly change throughout the year, as last fiscal year the state ended with a $90- billion surplus.
The new projected decline indicates that the economy might not be as robust this year as originally expected.
The California Department of Finance reports that June’s tax revenues fell short of expectations, rather than exceeded them, for the first time since the pandemic. Revenue was off by about $2.4-billion.