The budget situation in Mississippi could get worse before it gets better.
That was the forecast State Treasurer Tate Reeves delivered this afternoon at the Stennis Capitol Press Corps luncheon in Jackson.
While sales and income tax collections are not down dramatically the first eight months of fiscal year 2009, corporate income taxes are down $51 million for the same period.
For February alone, corporate income taxes were down 71 percent from the revenue estimate. The deficit in corporate income taxes represented more than half of the $9.7-million deficit for February.
“(Corporate incomes taxes) are a leading economic indicator,” Reeves said. “As corporations are paying less and less in taxes based upon their expectations that business is not good, and the profits are not going to be there, ultimately that’s going to flow to (sales and personal incomes tax collections).”
That will cause the revenue estimate for FY10, whose budget legislators will have to adopt, to spiral, perhaps “rather significantly,” Reeves said.
Mississippi’s Revenue Estimating Group, of which Reeves is a member, will most likely meet some time before legislators adjourn the regular session April 6 to adopt a revenue estimate for FY10.
To go with his warning about revenue collections, Reeves threw his support behind voter ID legislation that has been circulating through the Capitol. Good voter ID laws, Reeves said, must include a stipulation that requires voters to show photo identification.
“We need to outlaw identity theft at the polling plate,” Reeves said.
MS Business Journal