May tax revenues $30m higher than expected

Collections still lag $439m behind forecasts for year

STATE TAX REVENUES in May came in $30 million higher than expected, but that still leaves Beacon Hill officials with a $439 million revenue shortfall to deal with before the fiscal year ends at the end of the month.

The Department of Revenue reported on Monday that tax collections in May totaled $1.9 billion, which was $30 million, or 1.6 percent, higher than expected. Income tax collections were 3.2 percent higher than expected for the month, and sales and use tax collections were up 4 percent.

Still, revenues are lagging $439 million, or 1.9 percent, behind what was forecast for the fiscal year to date. Revenues were nevertheless up 1.2 percent, or $274 million, compared to the same period a year ago.

Gov. Charlie Baker, speaking to reporters before the revenue numbers were released, didn’t sound overly concerned. He said his administration would do some “nipping and tucking” to the budget to balance revenues and expenditures.

“Every year things happen and because things happen there are many line items in the budget that actually don’t end up spending their full appropriation. We just started paying attention to that a lot earlier than we normally would,” Baker said after a meeting with Lt. Gov. Karyn Polito, Senate President Stanley Rosenberg, and House Speaker Robert DeLeo.

Rosenberg was less sanguine about cutting spending. “I think at some point we’re just going to have to come to grips with this. We’re nibbling around the edges by cutting here, cutting there, nipping and tucking here and there, and doing little bits of revenue here, little bits of revenue there. We have something to protect and we’re going to have to invest in that,” Rosenberg said, referring to the state’s newly acquired status as the No. 1 state in the country by U.S. News and World Report.

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Natasha Ishak

Editorial Intern, CommonWealth magazine

About Natasha Ishak

Natasha Ishak is the editorial intern at CommonWealth magazine. Her duties include reporting and writing on the latest policy issues happening on Beacon Hill.

Before arriving at CommonWealth Magazine, she worked as a digital intern under NOVA/PBS at WGBH. She was a reporter in her hometown of Jakarta for four years, writing up stories at The Jakarta Post - Indonesia's oldest leading English-language daily, and as a production assistant on the popular news program, the Indonesia Morning Show.

Now in her second year pursuing a master's degree in journalism at Emerson College, she hopes to shed light on marginalized communities through stories related to politics, immigration, social justice and the environment.

About Natasha Ishak

Natasha Ishak is the editorial intern at CommonWealth magazine. Her duties include reporting and writing on the latest policy issues happening on Beacon Hill.

Before arriving at CommonWealth Magazine, she worked as a digital intern under NOVA/PBS at WGBH. She was a reporter in her hometown of Jakarta for four years, writing up stories at The Jakarta Post - Indonesia's oldest leading English-language daily, and as a production assistant on the popular news program, the Indonesia Morning Show.

Now in her second year pursuing a master's degree in journalism at Emerson College, she hopes to shed light on marginalized communities through stories related to politics, immigration, social justice and the environment.

“You’re not going to reform your way out of this problem. There’s only so much you can save through that. There needs to be additional revenues discussed, serious revenues, and the first step would be the Fair Share Tax,” he said.

The Fair Share Tax, better known as the millionaire’s tax, is a proposed constitutional amendment that would impose a surcharge on incomes over $1 million. According to Rosenberg, the surtax would provide enough funds for the state to continue investing in two of its top priorities: education and transportation.