Gov. Gavin Newsom and California lawmakers may likely need to address a larger deficit next year than previously forecast due to an “increasing likelihood” that state tax revenue will be significantly below projections, according to the state Department of Finance. The department projected that, because of an unprecedented six-month extension in the state’s tax filing deadline earlier this year, California would collect $42 billion in October. That figure represented nearly a quarter of this fiscal year’s total projected personal income tax and a third of the corporation tax. But, as of Oct. 25, California collected just $18 billion, according to new disclosures from the agency. Should the revenue collected and tallied by the state in the coming weeks fail to catch up to its forecasts, Newsom and lawmakers will need to fill a wider budget gap than anticipated next year...
The state, amid a new state bond sale, was required to provide a preliminary financial snapshot of October revenues to potential investors ahead of the end of the month. H.D. Palmer, a spokesman for the Department of Finance, emphasized that it’s not a final assessment and the state may wind up closer to its target by the time the department releases its routine monthly revenue report in mid-November. The financial disclosure released as part of the bond sale does not include the revenue raised during the last week of October and some tax returns filed before the report may not have been processed yet. Additionally, the IRS on Oct. 16 announced a postponement of the state and federal tax filing deadline to Nov. 16, which means some Californians who procrastinated until the last day may still not have filed their taxes...
Full story at https://www.sacbee.com/news/politics-government/capitol-alert/article281212308.html.
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