States End 2004 with Solid Revenues, Report Says
State tax revenues grew by 7.8 percent in the last quarter of 2004 compared to the same period in 2003, marking the strongest end-of-the-year revenue growth since 1991, a new report from the Nelson A. Rockefeller Institute of Government shows.
A relatively high inflation rate and - to a lesser extent - recently enacted tax increases contributed to the increased revenue. But even adjusted for those factors, state tax revenues grew 2.3 percent, the report said
Corporate income taxes recorded the sharpest gains (27 percent), while collections of personal income and sales taxes also swelled. Personal income tax collections grew 8.8 percent over 2003 levels, and state sales tax collections grew 6 percent.
Western states (Alaska, California, Hawaii, Nevada, Oregon and Washington) garnered the strongest revenue growth - 12.1 percent over 2003 - while states in the Great Lakes region (Illinois, Indiana, Michigan, Ohio, Wisconsin) saw the weakest - 2.9 percent.
Employment growth varied widely among states during the end of 2004 with the Rocky Mountain region seeing the greatest employment gains and the Great Lakes region the least. Thirty-one states experience employment growth of 1 percent or more, up from 24 the previous quarter.
Nevada continues to lead the country in job growth with 4.9 percent in the final quarter of 2004 compared to the same period in 2003.
Two states (Maryland and New Mexico) actually lost jobs. Nationwide, employment grew by 1.6 percent in the last three months of 2004 when compared to the same period in 2003.