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State And Local Tax Receipt Growth Slowing, Says Rockefeller Institute

The growth of tax receipts at the state and local level has slowed dramatically since the second quarter of 2015, according to Census Bureau data compiled by the Rockefeller Institute of Government at the State University of New York-Albany. Total major state taxes for the first quarter 2016 rose only 1.6% versus the year prior quarter, compared with average quarterly growth the previous four quarters of 4.5% the Institute reported. And preliminary data for the second quarter 2016 shows a decline of 2.1%.

The trend at the local level has been a bit better. Receipts rose 4.4% in the 1Q/16 versus a previous four-quarter average of 4.8%. With the two combined, state and local receipts rose just 3% in the first quarter, compared with a 5.4% four-quarter average the previous four quarters.

Slowing income and sales tax revenues, an outright drop in corporate tax collections, and extreme weakness in oil-producing states are behind the declines at the state level. At the local level, property tax receipts continue to post reasonable growth, up 5.7% in the first quarter, offsetting declines in sales taxes.

Complete information on state and local tax trends, including state-by-state data can be found at rockinst.org.

 

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