California Dreamin’ Fantasy: California is $20 billion in the hole so far this fiscal year. In April income from corporate taxes was down 35%, that from personal income tax was down 12%, and the state’s sales-tax receipts were down 20%. Trends start in California, work east.
California Budget Crisis (Source.)
Let’s see . . . the State of California budget assumes income tax and sales tax collections will increase over the next couple of years. Bawhahaha! In a bad economy people buy less and the unemployed aren’t paying personal income taxes. The two main revenue sources MUST decline.
According to the California State Controller’s most recent report (source): personal income taxes were $1.06 billion below the estimate (-12.6%), corporate taxes were below the estimate by $831 million (-35.6%) and sales taxes lagged the estimate by $108 million (-19.9%). These two obvious facts are NOT being considered by “leaders” in California. This cannot end well.