California’s Legislative Analyst Predicts $31 Billion Budget Surplus

SACRAMENTO (AP/CBS13) — California volition person a $31 cardinal fund surplus adjacent twelvemonth arsenic revenues proceed to ascent contempt the pandemic, according to a caller forecast from the state’s autarkic Legislative Analyst’s Office.

The predicted surplus is truthful ample the bureau estimates California volition surge past a law bounds connected authorities spending by much than $14 billion. That could necessitate Gov. Gavin Newsom and authorities lawmakers to either chopped taxes, walk much wealth connected schools and infrastructure oregon – possibly the much fashionable prime successful an predetermination twelvemonth – springiness rebates to taxpayers.

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California’s taxation collections person continued to soar contempt the pandemic. From April to June of this year, California businesses reported a grounds precocious $216.8 cardinal successful taxable income – a 38.8% summation implicit 2020 and a 17.4% summation implicit pre-pandemic 2019. This comes arsenic immoderate economists interest astir rising prices due to the fact that of inflation.

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This would beryllium the 4th twelvemonth successful a enactment of expanding revenue. But the LAO said it’s “impossible” to cognize whether California’s gross gains are sustainable.

“Recognizing this, our main gross forecast takes a mediate crushed of possibilities, assuming neither that the gains are wholly sustainable nor that they are wholly unsustainable,” the LAO wrote successful its yearly Fiscal Outlook.

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