Revenue from the state's three major taxes (sales, personal income and corporation) in May were $123 million below estimates in the governor's May budget revision, according to the state controller's monthly cash receipts report. However, in an unexplained development, the overall revenue estimate for May is up 1.3 percent, as the insurance tax is $130.6 million above estimates, and the "not otherwise classified" category is up $64 million.
Personal income tax revenue came in $14 million below estimates, the sales tax was $106 million below projections and the corporate tax was $2.7 million below the May revision number.
Controller John Chiang said: "While May revenues were steady, June revenues are the ones to watch. The last month of the fiscal year is now the biggest, and will signal how well the 2012-13 budget gets out of the gate."
The 3.1 percent drop in sales tax revenue in May has to be of concern to the governor, as his tax initiative relies on a 0.25 sales tax rate increase.
June 15, 2012
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