The state issued its year-end report today on fiscal 2021 tax revenue and it was a whopper, as expected.
The revenue forecast was revised at year-end to reflect the rush of money, but the earlier forecast shows the state ended with $6.4 billion in net revenue (after off-the-top deductions), $1.09 billion more than the previous year and $1.16 billion above the forecast on which state spending was based.
June, the final month of the year, continued the pattern, with gross revenues 24.7 percent above last year and 27.5 percent above the forecast. The particularly robust year-to-year increase in sales tax — a solid indicator of economic activity — was noteworthy. It was 12.9 percent higher than June 2020. Tax on motor vehicle sales was up more than 17 percent.
A flood of federal money helped. Some changes in timing of tax collections also affected results last year and this year. But the state is rolling in dough, with other money squirreled away in various reserve accounts.
We could pay for universal pre-K. We could pay for a meaningful restorative justice system with more parole and probation workers and transition services. We could pay teachers more, at least for health insurance costs. We could widen broadband access.
More likely, however, is an income tax cut that will primarily benefit the rich.