California Has $2 Billion In Unexpected Tax Revenue - LATimes

[WillyT]

California has $2 billion in unexpected tax revenue
Tax income has been outpacing forecasts — good news
as Sacramento struggles with a $15-billion budget deficit.
GOP leaders are already using it as fodder against
Gov. Brown's proposed tax increases.
By Shane Goldmacher, Los Angeles Times
May 5, 2011

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Reporting from Sacramento -- State officials are reporting an unexpected $2-billion surge in tax receipts that will help lawmakers close the remaining $15-billion budget deficit, and the Capitol is humming with hope that more is coming.

But the windfall could complicate Gov. Jerry Brown's push for tax increases, which he says are needed for California's longer-term financial health.

Some analysts say the surprise — the sign of a brightening economy — could be just the beginning. Revenue has crept up incrementally for months and jumped in April, when people paid their taxes. It may be time to raise projections, they say, with the potential for billions more to flow into state coffers.

"As much as a third of the deficit will probably, hopefully, disappear," said Brad Williams, an economist and former chief revenue forecaster for the Legislature.

But Brown is not talking that way. As the governor prepares his updated budget plan for release in mid-May, indications are that he will try to mute such expectations.

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More: http://www.latimes.com/news/local/la-me-state-budget-20110505,0,1073828.story

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