BEWARE W BEARING GIFTS:

Income growth means tax cut: Unexpected result narrows state gap (Scott S. Greenberger, December 7, 2004, Boston Globe)

Couples will save $30 on their state income taxes, and Beacon Hill budget writers will have an extra $300 million to spend in the coming fiscal year, as the recovering economy continues to pump money into state coffers at a faster rate than expected.

State officials confirmed yesterday that rising revenues will trigger an expansion of personal income tax exemptions. The change, which will save individual taxpayers about $15 a year, is called for in a tax bill the Legislature approved in 2002. Now couples will be able to deduct $7,150 from their taxable income, up from $6,600, and individuals can deduct $3,575, up from $3,300.

The announcement was made during a State House hearing in which administration officials and outside economists said the state is likely to collect at least $16.5 billion during the current fiscal year, $300 million more than the prediction Beacon Hill budget writers had settled on in October. That means the budget gap for fiscal year 2006 will be about $600 million, instead of the $900 million hole that was feared as recently as last month.

Remind us again why they voted against the GOP's economic policies?

Posted by Orrin Judd at December 7, 2004 10:34 AM