INDIANAPOLIS (AP) — Indiana’s state tax collections are expected to bounce back even stronger than expected from the pandemic recession.
A new state tax revenue forecast given Thursday to state legislators projects those collections going up by more than 4% in each of the next two years. That could mean about $2 billion more available for the new two-year state budget being completed by legislative negotiators after the last forecast in December projected growth between 2% and 3%.
Republican budget writers will likely face pressure to further increase school funding and the amount of money going to other state programs.
The latest budget proposal endorsed by the Senate this week would increase overall school funding by 1.2% the first year and about 3% the second year, slightly more than a plan that the Republican-dominated House endorsed in February.
Those plans include a contentious expansion of the state’s private school voucher program. Democrats have criticized the budget plans for doing little to directly boost the state’s lagging teacher pay or take up recommendations from the teacher pay commission appointed by GOP Gov. Eric Holcomb.
Holcomb released a statement on the revenue forecast:
“Indiana continues to significantly outperform national economic averages, providing our state a unique opportunity to accelerate our growth by investing in our people.
“Our next two-year budget will place Indiana in the enviable position to make long-term, wise and historic investments in our schools and education partners, market-driven workforce development programs, law enforcement officials, local community quality of life and place programs, transformational infrastructure projects, enhanced and expanded economic development tools, pay off debt, and pay cash for once-in-a-lifetime state facilities assets.
“Credit is due to many over the coming weeks, but Hoosier resiliency and all our healthcare workers who stood in the gap have powered our state’s success. They’re the reason we’re realizing the gains we celebrate today and more importantly, what they’ll lead to as we build one Indiana, for all!”