State and Local Tax Revenues Set Record in QIV

In another sign that the U.S. economy has made a full recovery from the 2007-2009 recession, state and local tax collections reached a new record high in the fourth quarter 2010 of $378.3 billion, according to data released today by the Census Bureau. Compared to the fourth quarter of 2009, state tax collections were up overall by 1.64%, helped by increases of more than 10% for individual income taxes, 14.3% for corporate income taxes, and 2.3% for sales taxes. Property tax collections fell by almost 3% over the year, most likely due to falling home values.

The rising tax revenues at the state and local levels to all-time record highs might suggest that the many states with budget deficits have a spending problem, not a revenue problem.

Update: Inflation-adjusted version of the chart below:

About Mark J. Perry 262 Articles

Affiliation: University of Michigan

Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan.

He holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University in Washington, D.C. and an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota.

Since 1997, Professor Perry has been a member of the Board of Scholars for the Mackinac Center for Public Policy, a nonpartisan research and public policy institute in Michigan.

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