Nov. 30 (Bloomberg) -- State tax revenue rose 3.9 percent in the third quarter from a year earlier, the third consecutive gain, as a recovering economy boosted receipts from sales and personal-income levies, a study of 48 states shows.
Increases occurred in 42 states, according to data compiled by the Nelson A. Rockefeller Institute of Government in Albany, New York. Compared with July through September of 2008, tax receipts in the 48 states fell 7 percent, the group said.
“With three straight quarters of growth, the trend is clearly positive,” Robert Ward, the institute’s deputy director, said yesterday in an e-mailed comment. “The problem is that states have been down so long, it’s hard to say where up is located. Revenues are still below the level of two years ago, because of very sharp declines in 2009.”
The longest recession since the Great Depression cost millions of Americans their jobs and homes, leaving states to cope with dwindling revenue and mounting budget deficits. Employment increases in New York and Texas last month led gains in 41 states, according to Labor Department data, a sign that the nation’s job market may be stabilizing.
New York had the largest third-quarter increase in tax receipts, collecting $577 million, or 4.5 percent, more than a year earlier, the institute said. The gain was mainly driven by higher personal-income tax collections and growth in payments of levies on retail sales, the group said.
Alaska Down Most
Alaska reported the largest drop in tax revenue among six states that had declines, the institute said. Alaska receipts plunged 48 percent, mainly because of lower collections from oil and gas producers, it said.
Personal-income tax payments, which made up 41 percent of total third-quarter tax revenue, rose 4.7 percent nationwide compared with the 2009 period, the institute said. Collections were down 6.9 percent from two years earlier, it said.
California and New York had the biggest dollar gains in receipts from personal-income taxes in the three months through September, with increases of $610 million and $315 million, respectively, the institute said. Alabama, with an 18 percent jump compared with a year earlier, had the biggest percentage increase. Hawaii had the largest decline, at 54 percent, because of a delay in tax refunds from 2009, the group said.
Sales tax collections increased by 4.1 percent in the third quarter, compared with a year earlier, the institute said. Receipts were 5.1 percent lower than two years earlier.
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