Massachusetts collected $2.6 billion in tax revenues in July, a haul that was roughly on par with what the state introduced in throughout the identical time final yr, in response to a Division of Income report launched Monday.
The income report for the primary month of fiscal yr 2025 was made public solely days after a high finances author within the state Senate warned collections for July have been anticipated to be “very bad.”
July revenues got here in about $18 million much less, or 0.7% under, what the state collected in July 2023, in response to the Division of Income. The decreases have been seen in withholding, non-withheld earnings tax, and the “all other” tax class, Division of Income Commissioner Geoffrey Snyder stated.
“These decreases were partially offset by increases in sales and use tax, and corporate and business tax. The decrease in withholding reflects current labor market conditions as well as periodic fluctuations. The decrease in ‘all other’ tax is due, in part, to estate tax, a category that tends to fluctuate,” Snyder stated in a press release.
Gov. Maura Healey’s administration has not but launched its income benchmark for the fiscal yr so the July haul can’t be measured towards officers’ expectations.
July is likely one of the smaller tax collections of the month as a result of quarterly funds are usually not due for most individuals and companies, in response to the Division of Income. Solely about 7% of annual income has traditionally are available throughout July, the division stated.
Massachusetts Taxpayers Basis President Doug Howgate cautioned towards utilizing the July income report as a predictor for the remainder of the fiscal yr.
“I think it’s important to know July and August really are small months,” he advised the Herald. “That’s not to say you don’t want to track these numbers closely, and you always want to collect more in one month than you did the year before in the same month, but I think that I wouldn’t read too much into this and we’ll know more once we start to get towards the end of the first quarter.”
Throughout a marathon finish to formal lawmaking final week, Senate finances author Michael Rodrigues stated revenues for July have been anticipated to be “very bad,” which he used as a cause for not voting to revive any of the $317 million Healey vetoed from the fiscal yr 2025 finances.
A spokesperson for Rodrigues didn’t instantly reply to a Herald inquiry despatched Monday afternoon.
In a letter outlining her finances vetoes, Healey additionally warned of “uncertainty” within the economic system at the beginning of fiscal yr 2025.
“Interest rates reductions anticipated at the start of the year have not materialized and tax collections for FY24 underperformed in some categories compared to our original expectations,” she wrote. “Also, as is usually the case, there will be some deficiencies which will require active management. It is our responsibility to be good stewards of our resources and live within our means.”
