| SAN FRANCISCO
SAN FRANCISCO May 10 California's state tax
collections in April fell short of expectations, a sign that the
state may be headed toward an economic downturn, State
Controller Betty Yee warned on Wednesday.
Collections totaled $15.98 billion, $1.05 billion or 6.2
percent short of the governor's projected budget for the month.
"April is usually the state's biggest tax filing month, so
lower-than-expected personal income tax receipts are troubling,"
said Yee, the state's chief fiscal officer, in a statement.
"While we await the governor's May Revision, this is another
signal that we may be inching towards an economic downturn, and
we must tailor our spending accordingly."
California has collected $96.88 billion during the first 10
months of fiscal 2017, which ends June 30. That means the state
is $1.83 billion behind last summer's budget estimates and
$211.3 million shy of January's revised fiscal year-to-date
Governor Jerry Brown plans to release on Thursday his
mid-year revision of the proposed state budget for fiscal 2018.
The revised budget is expected to reflect changes in the state's
financial position since January.
For the month of April, during which California tends to
collect about 17 percent of its personal income tax receipts,
collections lagged by 5.3 percent. Retail sales and use tax
receipts fell short of projections in the governor's proposed
2017-18 budget by $106.7 million, or 13.3 percent. Corporation
tax receipts for April were 13.8 percent lower than estimates in
In January, Governor Brown proposed a $179.5 billion state
budget for fiscal 2018, a 5 percent increase over this year, but
he warned that the state must remain fiscally prudent ahead of
an inevitable economic downturn.
California is especially vulnerable to downturns, because
the state is more reliant than most on capital gains taxes, a
volatile revenue source, and less on property tax revenue, which
is more stable.
(Reporting by Robin Respaut; Editing by Richard Chang)