State Faces $315 Million Deficit on Lower Tax Collections

(Bloomberg) — New York state faces a $315 million budget deficit because tax revenue hasn’t increased as much as projected three months ago, when lawmakers approved the spending plan, the Division of Budget said.  Tax collections for this fiscal year are now forecast at $61.4 billion, down $343 million from August estimates, the division said in a report yesterday. The budget, including increased federal aid, is now estimated at $135.3 billion.  “The slowdown in economic growth in the second and third quarters of calendar year 2010 has been more pronounced than expected,” the report said. Slower growth reduced tax revenue and increased contributions to the Medicaid health-insurance program for the poor, it said.

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