Strong State Tax Growth Continued in the Second Quarter of 2022 but Weakened in the Third Quarter
December 13, 2022
Total state tax revenue collections increased 14.5 percent in nominal terms and 6.4 percent in real terms in the second quarter of 2022 relative to a year earlier. Both personal and corporate income tax revenues saw year-over-year real growth in the second quarter of 2022, at 6.6 and 27.1 percent, respectively. State sales tax collections grew 1.2 percent in real terms while motor fuel tax collections declined 11.8 percent in the second quarter of 2022 relative to a year earlier.
The longer-term outlook for state and local budgets also remains uncertain depending on federal monetary policy decisions and ongoing state actions, especially as federal assistance programs end and as temporary changes caused by the pandemic wane.