In between each Budget & Economic Forecast , we also prepare a quarterly Revenue & Economic Update in January, April, July and October of each year. The Revenue & Economic Update reports on how actual revenue collections for the current year compare to the previous forecast as well as provide notes on changes in the national and state economic outlook.
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January 12, 2015
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Revenue. Minnesota’s net general fund receipts totaled $3.518 billion during the months of November and December, $212 million (6.4 percent) more than projected in November 2014’s Budget and Economic Forecast. Net receipts from all major tax types were above forecast for the period. The individual income tax provided the largest amount of additional revenue, but much of this is believed to be due to timing of payments, rather than additional tax liability.
Economy. The 2015 outlook for U.S economic growth has improved since Minnesota’s Budget and Economic Forecast was last prepared in November. Since that time, more recent data on job growth, hours, and retail sales have exceeded expectations, industrial production has boomed, and gasoline prices continued to move lower, dipping below $2.25 per gallon in early January for the first time in nearly six years. Plummeting gas prices are freeing up household cash for other purposes and boosting confidence. Separate measures show that confidence among U.S. consumers and businesses have recently jumped to the highest levels since early 2007. These factors combine to provide solid evidence of improved overall economic growth. Looking ahead, the key to stronger consumer spending will continue to be stronger average wage growth.