State revenues continue to pour in

Thanks to Alabama's booming economy, revenues to the state's General Fund and Education Trust Fund continue to grow, reaching record levels. According to the Birmingham News:

MONTGOMERY - State tax collections continued their red-hot growth during the government's fiscal year which ended its first nine months Friday, according to state finance department reports released Monday.

Tax collections and other revenue for the Education Trust Fund, which supports public schools and colleges, totaled $4.085 billion from Oct. 1 through June 30, an increase of $359.5 million, or 9.65 percent, compared with the same period a year earlier. ...

Combined personal and corporate state income tax collections totaled $2.37 billion from Oct. 1 through June 30, an increase of $246.2 million, or 11.6 percent, compared with the same period a year earlier. State sales tax collections totaled $1.183 billion from Oct. 1 through June 30, an increase of $61.8 million, or 5.5 percent, compared with the same period a year earlier.

The fast growth in the trust fund so far this year continues a trend from last year. The Education Trust Fund in the fiscal year that ended Sept. 30 grew by 11.5 percent compared with the previous year. That growth, and the 9.65 percent growth for the first nine months of this fiscal year, both are well above the long-term average growth in the trust fund of about 5 percent.
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The state General Fund, which supports Medicaid, prisons and other non-education state agencies, grew by an even faster rate than the larger Education Trust Fund.

Tax collections, interest payments and other revenue for the General Fund totaled $1.13 billion from Oct. 1 through June 30, an increase of $156.2 million, or 16.1 percent, compared with the same period a year earlier.

This is great news, and it creates yet another opportunity for the Governor and legislature to return some of the state's revenue windfall to the taxpayers. They should start by 1) indexing personal income tax brackets for inflation; 2) following up on this year's tax cuts with another increase in the thresholds for paying income taxes; and 3) reducing corporate income taxes, while simultaneously eliminating direct subsidies to corporations - including those to promote "industrial recruitment." These three measures would bring greater fairness to Alabama's tax code and improve Alabama's business climate and growth potential. So...who'll be the first candidate to adopt them as a part of their campaign platform?