LOS ANGELES - California state income tax collections were on target in January, with personal income tax collections slightly below monthly projections and corporate tax collections somewhat above projections, according to a report from the Legislative Analyst's Office.
The LAO, a nonpartisan government agency that has been providing fiscal and policy advice to the California Legislature since 1941, uses data from daily agency cash collection reports of the Franchise Tax Board and the Employment Development Department.
Personal income tax collections totaled $9.81 billion for the month, down slightly from the updated projection of $9.87 billion. PIT withholding was about $500 million, or 10% above projections, while PIT estimated and other payments for the month of January were about $725 million, or 13% below projections.
For December and January combined, PIT estimated and other non-withholding payments were 28% below collections during the same two-month period last year.
"This is roughly in line with what our office expected in our November forecast, given that our office — like the administration — anticipated a large drop in capital gains-related taxes for the calendar year 2013, due largely to change in federal tax policy that caused many high-income earners to "accelerate" income into 2010," LAO analysts said in the report.
Analysts said PIT withholding projections, which assume a 5.7% growth over last year, seem reasonable for the rest of the year.
However, the office's November forecast projected higher PIT estimated payment collections in April and June 2014 than the administration currently expects. The administration's updated projections assume payments for the rest of the year rise by 10.4% from last year.
Corporate tax collections totaled $321 million, with $75 million of refunds, for a net amount of $246 million — about $175 million above updated projections.
Both the LAO and the state administration are expected to release new state revenue projections in May.