The state has begun achieving the sharp, double-digit growth on income tax revenue that financial analysts said is desperately needed if the Murphy administration wants to avoid much-feared spending cuts in the coming months.
State Treasury data from March showed the state’s gross income tax amount grew 21 percent in March year-over-year. Meanwhile, the state’s overall revenue grew almost 17 percent.
The March numbers serve as a sign that the Murphy administration’s prediction is panning out—that gross income tax revenue is lagging because of taxpayer behavior resulting from the 2017 federal tax changes, and that the revenue will be made up for by the end of tax season.
State Treasurer Elizabeth Maher Muoio will testify before both the Senate and Assembly budget committees in mid-May once tax returns are filed, to see whether or not those predictions came true.
Income tax money is down 3.9 percent compared to last year, and the 2019 budget, which ends June 30, calls for 3.5 percent growth.