U.S. states saw their tax revenue drop by about $31 billion, or 6 percent, from March through August, compared to the same period a year earlier, as the pandemic triggered economic shutdowns across the country, according to data from 44 states compiled by the Urban Institute.
The scale of the drop appears smaller than expected, relative to the depth of the economic contraction, and comes after several states have reported that their revenue didn’t decline as much as anticipated despite business shutdowns and increased unemployment. In August, when much of the country was reopening, state revenue climbed about 1.1 percent from a year earlier, the Urban Institute found.
Brett Miller is chief financial officer at Restaurant365, where he is responsible for financial and strategic functions including accounting, audit, treasury, corporate finance and corporate strategy. He also leads all IT-related activities. Prior to joining R365, he led the M&A and global strategy teams for a Fortune 500 manufacturing company. He received his CPA license while a member of the transaction services team at KPMG.
Dr. Wayne Jenkins is an accomplished physician and executive with a proven track record of patient-centered, revenue-driven results. Over the course of his career, he's consistently transformed large, complex healthcare systems into market leaders that deliver quality and value in a dynamically changing environment. Prior to Centivo, he was the Chief Clinical Officer for Population Health at Vanderbilt University Medical Center, where he provided clinical oversight of value-based care delivery and completed the formation of Medicare Accountable Care Organizations (ACOs). Before his time at Vanderbilt University Medical Center, he served as the Senior Vice President and Chief Strategy Officer of Orlando Health, as well as President of Orlando Health Physician Partners. Previously, Wayne was the chief of radiation oncology and then subsequently the medical director for the Florida affiliate of M.D. Anderson Cancer Center, a subsidiary of Orlando Health, Inc. Wayne holds a BA from the University of Tennessee, an MD from Vanderbilt University School of Medicine, and a Master's of Health Policy and Administration from Johns Hopkins University. He is board-certified in radiation oncology and was recognized in Best Doctors in America annually from 1994 to 2015. He's published 18 scientific articles and is often sought out to speak at state and national conferences.
The tax figures come as Republicans in Washington balk at extending aid to states and cities to help cover budget deficits that are expected to continue as the coronavirus weighs on the economy. Experts say that states’ financial outlooks could worsen as the effects of the stimulus bill fade and high unemployment reduces tax bills next year.
The August increase should be viewed with caution since income-tax deadlines were pushed back to July, which could have resulted in some revenue being processed later, according to Lucy Dadayan, senior research associate with the Urban-Brookings Tax Policy Center at the Urban Institute. Personal income-tax collections, which rose 3.8 percent in August, were in some cases supported by backlogged unemployment insurance benefits subject to withholding tax, Dadayan said.
Between March and August, tax revenues fell 6.4 percent year over year, with 36 states reporting declines over that period, the report said. Between March and August, eight states, including Washington and Georgia, reported growth in tax revenue.
“Due to the shifting in timing of tax receipts this past year, it is crucial to view August year-over-year revenue gains and fiscal year to date data with caution,” Dadayan said in the report.