April 17, 2008

'God is in the details' -- Nietzsche

At first glance, this chart showing state revenue for March, released today by the Wisconsin Department of Revenue, is cause for cheering.

What recession? It shows income tax collections all-but doubled from last year -- up 97.1% from March 2007, and up 5.9% year-to-date; overall tax collections up 18.2% in March, and 3.8% year-to-date.

Alas, the fine print -- the notes to the above chart -- tells a different story: it's all just a matter of timing. Income tax withholding last year was negatively impacted by the fact that March 31, 2007, fell on a weekend, so the payment was not recorded until April. "Hence, collections for March of last year are artificially low, making the growth rates for individual income tax and total taxes this year appear larger. Adjusting for the late posting, individual income taxes increased 8.0% in March -- still no slouch -- and the year-to-date increase is 3.0%. Total collections, after the adjustment, are 1.3% for March and 2.3% YTD."

As Gilda Radner's Emily Litella would've said, had she been a Cheesehead: "Never mind!"

A similar "Oops" has changed the meaning of the sales tax collection figures. "March sales tax collections reflect February sales. Adjusting for the extra “leap year” day, the March increase in the sales tax collections is 0.5%."

What we do not see, however, is a fine-print explanation of the bump in cigarette and tobacco tax collections. Seems the extra $1 a pack tax, whatever its "intended" dampening on sales, is just turning out, at this early date, to be a solid revenue source. Damn the health effects, full speed ahead.

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