October 3, 2005

ROMNEY CALLS FOR TAX CUT AS REVENUES COME FLOODING IN

Following news that state tax revenues are breaking new records, Governor Mitt Romney today renewed his call to lower the state income tax to 5 percent from 5.3 percent.

Preliminary revenue collections for September were $1.940 billion, an increase of $242 million or 14.3 percent over last September. Total monthly tax collections were $177 million above the September benchmark. Year-to-date collections were $4.334 billion, an increase of $317 million or 7.9 percent. After three months, fiscal ’06 collections are $194 million above the benchmark.

“No matter how you look at it, this is extremely positive news for the people of Massachusetts. Revenues were up across the board in every single category. There are more people working, our business sector is healthy and creating jobs and consumers are spending money,” said Romney.

Romney announced that tax collections came in $1.2 billion higher than originally forecast for the prior fiscal 2005 year, that the Stabilization Fund has been returned to pre-fiscal crisis levels of approximately $1.7 billion and that state aid to education is at an all-time high.

“Now, it’s time to take the next step,” said Romney. “There is no longer any reason not to give the people what they voted for – a 5 percent income tax rate.”

Despite a two-day sales tax holiday in August, sales and use tax collections in September were higher than last year and slightly below the benchmark. August sales and use tax collections are reported and paid by retailers in September. The true impact of the Sales Tax Holiday Weekend will not be known until December when DOR completes its analysis.

Income tax collections for September totaled $1.025 billion, an increase of $117 million or 12.9 percent over last September. Withholding tax collections totaled $627 million, an increase of $48 million or 8.2 percent. Sales and use tax collections were $326 million, up $11 million or 3.4 percent. Corporate and business tax collections totaled $433 million, an increase of $113 million or 35.2 percent over last September.

Year-to-date income tax collections were $2.341 billion, an increase of $152 million or 7.0 percent. Year-to-date withholding tax collections were $1.900 billion, an increase of $91 million or 5.1 percent. Year-to-date sales and use tax revenues were $1.050 billion, an increase of $53 million or 5.3 percent. Year-to-date corporate and business tax collections were $502 million, an increase of $128 million or 34.3 percent.

Tags: Taxes, Mitt Romney