“We still hope to meet the forecast”: Porter comments on April revenue report
State Rep. Gregory W. Porter (D-Indianapolis) issued the following statement regarding the most recent revenue report which shows a dip in state collections per our forecast estimates when it comes to April revenues:
“The April revenue report from the State Budget Agency (SBA) showed a $392 million negative difference between the forecast and actual collections for the month. Even though we came in beneath forecast, it’s crucial to understand that this significant variance is truly attributable to accounting measures. Recent changes to federal and state laws have changed the way we collect taxes.
“In 2017, the federal Tax Cuts and Jobs Act greatly reduced the ability of taxpayers – both individuals and businesses – to claim previous deductions which they claimed under the State and Local Tax deduction (SALT). Other states devised a work around to still claim these deductions and these laws were allowed by the IRS. In 2023, Indiana finally caught up to our neighboring states and quickly enacted our own version of the SALT deduction for businesses called SEA 2.
“During the 2023 session, I made it clear that I supported this type of tax relief, but it will result in major fluctuations in monthly revenue collections throughout the year. I predicted this outcome during my discussions of SEA 2. Revenue comes in early to the state and increases our revenue, but most of these dollars will be dispensed back to businesses as they file their returns. This is a temporary windfall to the State. The proof is in the fact that we were $424 million above forecast this winter and now after April tax filings we have a $392 million reduction. This is exactly how SEA 2 is supposed to operate.
““The bottom line is that we're still above our forecast with two months to go in the state fiscal year. The seesawing of revenue collections is concerning at first glance but wholly due to accounting matters. We still hope to meet the forecast and our economy is still booming.”