Massachusetts collected $260 million less in tax revenue in May. But the state is still ahead of projections for the year as lawmakers head into the final furlong of budget season. The state collected nearly $2.5 billion last month, according to new state Revenue Department data. That’s 9.6% less than actual collections in May 2023, and $192 million, or 7.3%, behind projections.
Year-to-date collections totaled a hair over $36.3 billion, which was $1.27 billion, or 3.7% more than collections at this time last year, officials said. Collections are $700 million, or 2%, ahead of projections officials said.
Tax Collection Breakdown
Tax collections “decreased in all major tax types in comparison to May 2023,” Revenue Commissioner Geoffrey Snyder said in a statement. The state took hits in three of its biggest collection categories last month: Income, corporate, and sales taxes, the data showed.
- Income tax collections totaled just about $1.4 billion last month, which was $123 million, or 8.1% behind projections, and $140 million, or 9.1% less than the same time last year.
- Sales tax collections last month totaled $790 million. That’s $23 million, or 2.8% behind projections, and $30 million, or 3.6% less than the same time last year, the data showed.
- Corporate tax collections, always an indicator in the post-pandemic economy, totaled $50 million, which was $34 million, or 40.6% behind projections, and $33 million, or 40.1% less than the same time last year, data showed.
Snyder attributed the dip in sales and income tax collections to “typical timing factors in collections.” “The decrease in non-withheld income tax was driven mostly by a decrease in the number of payments received this May relative to May 2023,” Snyder said. “The decrease in corporate and business tax was due to an unfavorable increase in refunds. The decrease in ‘all other’ tax is mostly attributable to a decrease in estate tax, a category that tends to fluctuate.”
May tends to be a “mid-sized” month for collections, the agency said, ranking seventh out of 12 months over the last 10 years.
Legislative Actions
The news came as House and Senate negotiators held their first meeting aimed at reaching a compromise budget for the new fiscal year that starts July 1. Negotiators offered no immediate timeline on an accord, State House News Service reported. “We’re going to be busy, seeing a lot of each other over the next few months for sure,” Senate Ways & Means Committee Chairperson Michael Rodriques, D-1st Bristol/Plymouth, said, according to the wire service.
