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Report: Tax collections less than projected

 

Madison – Wisconsin tax collections narrowly missed projections for the year   that ended June 30, delaying the possibility of further cuts in state spending   and services a month after the governor signed a bill to fix a $3.2 billion   shortfall, officials said Tuesday.

 

Tax collections were $23.8 million short of projections, just 0.2 percent off   estimates, according to a report released by the Department of Revenue.

 

Rep. Dean Kaufert, co-chairman of the Legislature’s powerful budget committee,   said the report suggests Wisconsin’s economy is turning around. He also called   it good news, considering lawmakers have had to approve plans to fix two deficits   in the past 14 months.

 

"I’m quite frankly somewhat relieved," said Kaufert, R-Neenah. "I’m   optimistic that we may be seeing the light at the end of the tunnel here. We’re   right on the verge of hopefully heading back in the right direction."

 

Gov. Jim Doyle in July signed a two-year budget for the period that began July   1. The budget fixed a $3.2 billion shortfall brought on by falling revenues   that did not cover requested expenses.

 

The tax-collection numbers were included a Department of Revenue report on   the state’s economic outlook. Though state revenues are on target, the job market   is expected to remain sluggish.

 

Revenue officials project total employment will fall by 0.1 percent between   July and September with manufacturing jobs dropping by 3.7 percent.

 

Manufacturing still sluggish

 

Jason Helgerson, Department of Revenue executive assistant, said that’s a sign   the state is still waiting for the manufacturing sector to turn around.

 

"As the world economy begins to grow at the end of this year and into   next year, that will really help our manufacturing sector," he said.

 

The unemployment rate is expected to remain at 5.4 percent for the period.

 

Still, Bob Lang, director of the nonpartisan Legislative Fiscal Bureau, said   nothing in the report suggests the state should revise its revenue projections   for the two-year budget.

 

The state is expected to have more than $140 million surplus in the first year   of the budget, more than enough money to cover the $23.8 million the state fell   short of projections, Lang said.

 

He said officials will have a more complete picture of the state’s finances   in mid-October after reports on expenditures come in.

 

The report released Tuesday showed:

 

     
  • Total tax collections were $10.2 billion, a 1.8 percent increase over the   previous year.
     
     
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  • Individual income-tax collections increased $72 million over the previous   year, up 1.5 percent. That was still $68 million below what officials had   predicted.
     
     
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  • Collections from sales tax grew 1.1 percent.
     
     
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  • Corporate tax collections were up 4.7 percent to $527 million. That was   $37 million above the estimate for the fiscal year.
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