July tax revenues offer some hope
Narrow FY20 deficit, provide FY21 stability
STATE REVENUE COLLECTIONS in July helped narrow the deficit for fiscal 2020 and provided some stability heading into fiscal 2021.
The Massachusetts Department of Revenue reported on Thursday that it collected nearly $4.5 billion in taxes in July, of which nearly $2.2 billion will be apportioned to fiscal 2021 (which began July 1) and $2.3 billion to fiscal 2020 (which ended June 30). The $2.3 billion is going to fiscal 2020 because it represents taxes owed for 2019; the deadline for paying those taxes was shifted from April 15 until July 15 this year because of the coronavirus pandemic.
With the infusion of the $2.3 billion, Massachusetts appears to have ended fiscal 2020 with nearly $29.6 billion in state revenues, about $721 million less than what officials had been counting on to balance the budget.
It’s unclear how big the actual state deficit is for fiscal 2020, but officials can draw on a $3.5 billion rainy day fund to close it.
State budget officials have put off crafting a budget for this fiscal year until sometime this fall. They said they first wanted to see July and August state tax revenue figures and learn whether the federal government will pass another stimulus bill providing additional aid to the state.