Breaking News – Connecticut Income Tax collections down $450 million from anticipated amount

Connecticut’s economy continues to be in deep trouble.  While unemployment is technically down, the way the economy is changing means lower income tax revenue for the state of Connecticut.

Some Connecticut residents have simply given up looking for work.  Others have taken jobs that pay well below what they used to earn and still other are working in part-time consulting work as opposed to full-time jobs.

Together these changes mean Connecticut’s tax picture is in deep trouble.

As Keith Phaneuf of the CT Mirror explained today;

Plummeting state income tax collections are experiencing their worst decline since the last recession, falling $450 million below anticipated levels for April.

The impact of this decline in revenue not only means Connecticut will face a budget deficit this year, but the revenue shortfall for the next two years will be much more severe than previously estimated.   The 3.6 billion deficit projected over the next biannual budget will grow by $500 million next year and $600 million the year after.

The state will now be facing a $4.5 billion gap between projected revenue and projected expenses.

As CT Mirror wrote, the new numbers mean that the state will probably

Close its third successive fiscal year in deficit;

And deplete its $235.6 million emergency budget reserve.

It increases the risk that state government might have to borrow to cover operating costs for the first time in eight years — even though it still hasn’t paid off nearly $1 billion in operating debt from the last recession.

Read more about this breaking story at: CT tax revenue in free fall, adding $1.1B in red ink for next 2 years

  • buygoldandprosper

    Dan Malloy fiddled while Connecticut burned. Oh! And he lit the matches with his failed policies and profligate spending.
    He can spin it any way he likes but this mess is all Malloy.
    His boot lickers have done well. Case in point…Mark Ojakian. Cathy has banked some serious money with her GHAC gig…a job she was imminently unqualified for. There are six+ years of examples!
    He came back from Puerto Rico and wants to make nice?!
    This state is TOAST and Danny is the cause. It is all Dan Malloy…with a little help from Sharkey,Looney, and the usual suspects.

  • JMC

    Tax, spend, indebt, entitle, kick the can, pump out free cash and bennies to the Dem base. What could go wrong? Dannel should have beamed out in time to DC, like Stolen Valor and Chrissie Pants Creases.

    That math-thingy is a byatch! Logic too! But the Dem pols will survive. Crisis is their stock-in-trade. Lots of drama, feelings of self-importance, anxious faces looking up at you. Life is good.