States Hit by Drop In tax Collections

Tax collections tumbled 11% across the 44 states in the third quarter, according to a report that suggests government revenues will remain depressed long after the economy has recovered from recession -- so reports Conor Dougherty in The Wall Street Journal. He was writing about a new report from the Nelson Rockefeller Institute of Government at the State University of New York. The reports says every major source of state revenue -- sales, corporate and personal income taxes fell in the third quarter. A recent NACo survey -- How Are Counties Doing? An Economic Status Survey -- finds much of the same. The leading revenues causing county budget shortfalls are: property taxes (52% reporting counties said), reductions in state or federal funding (50%) and sales taxes (46%). Four out of five counties said they expect budget shortfalls to continue into next budget year.