STATE OF CONNECTICUT
THE STATE COMPTROLLER
|WYMAN SAYS DEFICIT RISES TO $1.2 BILLION AS REVENUES CONTINUE SLIDE|
|Contact: Steve Jensen|
State Comptroller Nancy Wyman today said the projected state budget deficit has risen to $1.2 billion as major tax categories continue to slide.
The estimated deficit has risen by about $139 million in the last month, driven mainly by drops in collection of the income tax, sales tax and the tax that corporations pay on profits.
"As the final quarter of the fiscal year approaches, the decline in these major tax categories is accelerating,"Wyman said. "Decisive action to reduce this historic shortfall must be taken quickly to avoid completely draining our $1.4 billion Rainy Day Fund."
The income tax was expected to bring in $7.6 billion this year, but will likely fall at least $900 million short of that target due to the decline of the financial markets and the loss of about 29,000 jobs in Connecticut. The state will also pay out about $140 million more in tax refunds than was anticipated.
Collections of the sales tax are expected to decrease by about $352 million from original estimates, and the corporation tax is down by about $183 million.
Wyman's estimate, which includes close to $650 million in deficit-mitigation steps approved by the General Assembly, is about $295 million higher than that of the Governor's budget office.
The current projected deficit of $1.2 billion is based on a 2009 budget of $18.4 billion.
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