April saw $1b extra in tax revenue

Mass. officials say plans for spending cuts to state budget won’t change

In a good surprise for once, Massachusetts collected $1 billion more in tax revenue than it projected in april, helping steady the state’s uncertain fiscal picture as the legislature builds the state budget for next fiscal year.

the development marked a stark reversal from earlier in the fiscal year when collections lagged expectations for months, prompting state officials to slash spending, downgrade their revenue forecast, and, last month, freeze some state hiring.

but governor Maura healey’s top budget official said friday that state officials do not plan to reverse any of those decisions in light of april’s good financial news. and, officials say, the developments come with important caveats.

Matt gorzkowicz, healey’s budget chief, said officials believe most of the unexpected revenue was generated by the state’s new surtax on annual income exceeding $1 million — the so-called millionaire’s tax — and collections from capital gains, all money that state officials largely can’t use to balance the budget as a whole.

revenue from the millionaires tax is constitutionally mandated to go toward education and transportation initiatives, while excess revenue from capital gains must flow to the state’s emergency savings account.

state officials won’t officially determine for months how much money was generated specifically by the millionaires tax or capital gains. nevertheless, gorzkowicz said friday