Report: State Tax Revenues up by 3% in the Second Quarter of 2012

WASHINGTON — State tax collections increased by 3% from April to June this year, rising for the 10th straight quarter since the beginning of 2010, according to preliminary data in a new report issued by the Rockefeller Institute of Government.

Among 48 early reporting states, 40 reported gains while eight reported declines in overall tax revenue collections during the second quarter of this year, the report said.

However, tax collection growth has slowed during the last four quarters. The 3% gain in the second quarter follows a 4.7% increase in the first quarter.

The 10 straight quarters of growth follows five quarters of declines brought on by the recession, which officially ended in 2009.

Personal income taxes grew 4.3%, sales taxes only marginally increased at 2.7%, while corporate income taxes declined 4.7% in the second quarter of this year, according to the report.

"Overall, state tax revenues are showing continued improvement, though the pace of growth has been slow in the last four quarters," said Lucy Dadayan, senior policy analyst at the Institute and author of the report. "Now that most states have closed the books for fiscal year 2012, preliminary figures show 4.1% growth for the nation in total tax revenues during the fiscal year."

Every state except California and Delaware reported growth in overall tax collections for fiscal 2012 compared to the previous year. California had the largest decline, down $1.7 billion or 4.9% from the same period last year, mostly due to the expiration of temporary tax increases, the report said.

North Dakota had the largest overall increase in state tax collections, up 25.8% from the same quarter last year.

The Institute said it will release a full report on the second quarter data once the Census Bureau data is available.

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