Federal relief funds, higher-than-expected tax revenues drive nearly $1 billion revenue write-up for fiscal 2022.
The Maryland Board of Revenue Estimates today voted to dramatically increase the revenue projections for fiscal 2022 by 5 percent to $21.1 billion, representing a $995 million increase from the March estimates.
Additionally, the Board — which includes Comptroller Peter Franchot, Treasurer Nancy Kopp, and Budget Secretary David Brinkley — set the first official revenue forecast for fiscal 2023 at $22.2 billion.
Higher-than-expected collections in both the individual and corporate income tax are driving factors in the revenue write-up. At the same time, sales tax revenues have risen sharply since the Board’s last revision in March.
According to the Board’s Executive Secretary, Andrew Schaufele, $4.7 trillion in federal relief aid saved the nation from a deep recession and will likely permanently elevate the State’s tax revenue base, even once the federal funding dries up. That is primarily due to wage growth across all industries that will raise personal income tax collections and nonwage income growth.
Coupled with the announcement earlier this week that Maryland ended fiscal 2021 with a $2.5 billion general fund balance, the $995 million write-up for fiscal 2022 and $1.37 billion in estimated revenues for fiscal 2023 means state budget writers and policymakers have close to $5 billion in unanticipated revenue as they begin building the fiscal 2023 State budget.
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