Two months into the 2012-13 Fiscal Year, Pennsylvania's revenue collections tell a story of an expanding economy, albeit one that is growing more slowly than expected. Neither of which should be particularly surprising considering the slow but steady climb back from the recession experienced in Pennsylvania and the nation as a whole.
One important thing to keep in mind is that July and August are typically “small” months for revenue collections, as few corporate or quarterly personal income tax (PIT) payments are due. Combined, the two months make up less than 13% of the fiscal year’s expected revenue, so placing too much emphasis on the results of these early months can be misleading.
September collections contain more quarterly and business tax payments. Once those are tallied, we will have a better indication of how the revenue side of the state budget is shaping up for 2012-13.
Looking at the results from the first two months of the fiscal year, one positive sign is that tax collections continue to grow over prior years and are now higher than we’ve seen in any August of the past five years.