New income tax revenue projections show the state windfall from 1987 will be about $75 million, according to new estimates from the State Tax Commission.
However, because of the uncertainty involved in processing the flood of incoming tax returns, that $75 million figure could vary by as much $30 million up or down, according to state economist Doug Macdonald. However, he said that variance would drop to about $5 million in June.About $50 million of that windfall, which results from tax law changes and from workers who had too much money withheld from their paychecks, has already been budgeted. Assuming the $75 million estimate holds, the remaining $25 million would be refunded in the form of tax credits on next year's tax returns.
Macdonald told members of the Legislature's Revenue and Taxation Interim Committee he believes the $75 million figure could be a little low and that the final numbers, which won't be available until August, could be higher.