SAN FRANCISCO, Feb 14 (Reuters) - California’s revenue in January came in $5.099 billion above forecast in the governor’s state budget plan, propelled by a surge in revenue from personal income tax collections following voter-approved income tax increases in November, the state’s finance department said on Thursday.
Personal income tax revenue was $4.951 billion above projection, helping to put the state’s total fiscal-year-to-date revenue $5.112 billion above expectation, the department said in a report. California’s fiscal year started in July.
In addition to tax liabilities paid in January instead of April due to state tax increases, taxpayers expecting federal tax increases appear to have shifted income from this year to 2012, helping boost estimated tax payments last month.
Voters in November approved Governor Jerry Brown’s tax measure to raise revenue as a way to prevent spending cuts to education programs in the near term and to bolster the state’s deficit-plagued finances over the longer term.
Brown is counting on new revenue raised by the measure, which temporarily boosts the state’s sales tax and income tax rates for affluent Californians. At the same time, the governor is banking on fellow Democrats who control the legislature to restrain spending to help the state budget swing to a surplus.
Encouraged by California’s improving finances and expectations of balanced budgets, Standard & Poor’s last month upgraded its rating on $73.1 billion of the state’s general obligation bonds by one notch to A from A-minus. The action marked S&P’s first upgrade to the debt since 2006.