WASHINGTON — A report released Friday by the National Conference of State Legislatures shows a pattern of declining tax revenue in many states that threatens state provided services.
The housing downturn means less revenue will be reaped in coming months, as consumers react to high gas and food prices by pulling back on housing related purchases like appliances and furniture, exacerbating the problem.
According to the NCSL (www.ncsl.org) California will face a budget shortfall of $16 billion over the next two years and the gap is increasing in Florida and other states where home prices escalated in boom times. Twenty-three states and Puerto Rico have already reported budget shortfalls totaling $26 billion said the NCSL. Many states are already in recession said the report.
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Some states have benefited from oil price climb, however, including Alaska, North Dakota, Louisiana and Wyoming, whose economies are energy related. But many states are contemplating tax increases and are tapping into their "rainy day funds," said the NCSL.
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