In brief: The Massachusetts economy is strong. People paid more taxes than state beancounters expected.
At length: Massachusetts tax revenues are ahead of expectations five months into the state’s fiscal year. Four percent more cash came in to Commonwealth coffers than policymakers were assuming — and 8.4 percent more than July through November of last year.
But there’s no way to know whether the trend will continue.
The state Department of Revenue announced November revenues on Tuesday, a day before the top budget officials from the governor’s office, the House of Representatives, and the Senate hold a hearing about how much money the state expects to bring in during the fiscal year that runs from July 2019 through June of 2020.
That information-gathering session comes as the Massachusetts economy hums, with cranes dotting skylines across the state, a low unemployment rate, and data from across the country indicating this state is something of a boom state.
“Massachusetts’ economy has grown steadily in recent years, outpacing national and regional trends by most measures,” a bond rating agency wrote in recent weeks.
But the hearing will be held as some see dark clouds on the national horizon, with fears of a slowing economy and a full-blown trade war with China.
Massachusetts also continues to struggle with high pension and health care liabilities relative to other states, a long-term threat.
Top officials will use the information from the hearing to decide on an estimate for how much revenue the state will bring in for the next fiscal year. Based on the number, they’ll craft a 40-something-billion-dollar budget that will include everything from public education funding to human services.
The state brings in money through several different big categories of taxes, such as those on personal income, those on sales, and those on corporations. All were ahead of expectations in November, bringing the total to $10.7 billion for five months in the fiscal year so far.
“November was a solid month for revenues, which were above benchmark in all major tax categories,” Revenue Commissioner Christopher C. Harding said in a statement. “The main drivers were an increase in consumer spending on taxable goods, and continued strength in corporate payments.”
But, Harding cautioned, the fiscal year is not even half over, so his team will continue to closely monitor revenues streams.
In the fiscal year that ended in June, the state saw a whopping tax windfall: more than a billion dollars above expectations.
Joshua Miller can be reached at email@example.com.