Pa. rings up higher revenue than expected

April 30, 2008 5:12:12 PM PDT
April's revenue report brought good news for Gov. Ed Rendell and the state Legislature as budget talks approach, but a top state official cautioned that May collections may fall short as a result. Revenue Secretary Tom Wolf said April's tax collections were strong because, in part, his agency has improved its operations and processed annual income tax returns much more quickly than in past years.

"As a result, Pennsylvania will likely see lower-than-estimate income tax collections in May that could offset a significant portion of April's higher-than-estimate receipts," Wolf said in a statement.

In April, Pennsylvania rang up $3.7 billion in revenue, or $256 million above projections, in the year's second-biggest tax collection month. The money boosted the state's running surplus for the fiscal year to $437 million, or nearly 2 percent over projections.

Rendell and lawmakers are preparing to negotiate a $28 billion-plus budget for the new fiscal year that begins July 1. The budget that Rendell proposed in February relies on his projection of a $427 million surplus that he can carry over from this fiscal year.

Senate Republican aides, however, warned that the stagnant economy will affect next year's tax returns and should warrant a cautious spending approach.