A month after predicting the state will end the year $624 million in the red, state Comptroller Nancy Wyman adjusted her numbers downward Tuesday.
In her latest letter to Republican Gov. M. Jodi Rell, Wyman lowered the deficit by about $75 million to $549 million. The number is still higher than the $337 million deficit Rell hopes the legislature will mitigate on Dec. 15.
Both numbers exclude the half-percent reduction in the sales tax, which all parties have decided won’t take place on Jan. 1.
Aside from the lagging sales tax, Wyman said income tax receipts remain weak despite an increase in the income tax for the state’s wealthiest residents.
Collection of the quarterly estimated income tax payments typically made by investors is down by nearly 29.4 percent, Wyman said, and revenue from the payroll-withholding tax dropped by 4.3 percent.
“The extra revenue associated with the higher tax rate is being offset by a continued drop in overall receipts of the income tax,” Wyman, a Democrat from Tolland, said.
Democrats had predicted the income tax increase would boost revenue by $6.6 billion by the end of the year, but Wyman said it’s now expected to bring in about $6.4 billion.
In response to Wyman’s numbers, Sen. President Donald Williams, D-Brooklyn, continued to blame Rell for not achieving the cuts proposed in the budget passed this September.
“The Comptroller’s report also highlights another challenge to our state budget – the inability of the executive branch to curtail spending as called for in the budget,” Williams said. “Many of these cost savings and cuts were first proposed by Gov. Rell but are now not being achieved. According to the Comptroller, Rell administration spending is over budget by more than $210 million – a large chunk of the overall deficit.”
Last month when Wyman announced a $624 million budget deficit, Republican lawmakers called for quick action from the Democratic majority.
“Every single indicator shows us we’re in deep trouble,” House Minority Leader Lawrence Cafero Jr., R-Norwalk, said Monday in a telephone interview. “We’ve got to cut spending.”
Cafero said he does not know what additional information Democratic lawmakers need to help them understand that the state is in a budget crisis.