The state’s tax windfall streak seems to have continued right into this fall.
“Massachusetts Department of Revenue (DOR) Commissioner Geoffrey Snyder today announced that preliminary revenue collections for September totaled $4.187 billion, $194 million or 4.9% more than the actual collections in September 2021, and $224 million or 5.7% more than benchmark,” revenue said in a Wednesday release.
So far this year the state has taken $9.2 billion in taxes, about $450 million more than at this point last year and $224 million more than originally forecast.
Income taxes accounted for about $2.2 billion of September’s revenue, an increase over 2021 of 7.4% and $131 million more than expected.
Withholding taxes made up another $1.2 billion, 7.6% more than last year.
Sales tax brought in $766 million, 10% more than was taken in 2021 and nearly 12% more than was forecast.
“September revenue included increases in most major tax types relative to September 2021 collections, including increases in withholding, non-withholding income tax, and sales, and partially offset by a decrease in corporate and business tax. The increase in withholding is likely related to strong labor market conditions. The increase in sales tax reflects continued strength in retail sales,” Snyder said in the release.
Revenue says that September tends to be a good tax month due to the arrival of quarterly estimated payments from corporations and contractors but cautions the fiscal year is young enough September alone should not be taken as an indicator of how the rest of the year will go.
However, the month does normally account for a full tenth of the yearly take, they said.
“Historically, roughly 10% of annual revenue, on average, has been received during September,” the department said.
High tax takings last year led to the state auditor determining just last month that Massachusetts had taken too much in taxes and would need to send about $3 billion of it back to taxpayers.
It is unclear if the law that caused the tax rebate, Chapter 62F of the General Laws, is on track to be triggered again after 2022.
The state is forecast to pull in just shy of $40 billion over the course of the year, more than a billion less than was brought in last year.
If September represents theoretically represents 10% of the year, the state may be looking at another windfall year, with perhaps billions more than was forecast taken by the end of the fiscal year.
Herald wire services contributed.
