US states’ tax revenues are declining, leaving them facing tough budget decisions in the coming years.
Total state tax revenues in September fell 5.6% year-on-year for the 14th consecutive month on an inflation-adjusted basis, according to a new analysis by the Washington-based Urban Institute.
Of the 46 states that provided information, 34 reported year-over-year revenue declines.
Lower economic growth, tax cuts and a weak stock market are contributing significantly to the drop in income.
“They’ll have to come up with new revenue sources, increase the tax rates, reverse the prior tax cuts, or cut spending on different areas,”
said Lucy Dadayan, principal research associate at the Urban Institute.