More Coronavirus Stimulus Checks from California Possible as Analyst Predicts $31B Surplus
Since the beginning of the pandemic last year, the federal government has sent three stimulus checks, and is unlikely to send more direct payments. However, when talking about the states,...
Since the beginning of the pandemic last year, the federal government has sent three stimulus checks, and is unlikely to send more direct payments. However, when talking about the states, California leads the pack, and has so far sent two stimulus checks under its Golden State Stimulus program. Now, there possibly may be more coronavirus stimulus checks from California as the state is again predicted to have a budget surplus for the fiscal year 2022.
More Coronavirus Stimulus Checks From California Possible
A Wednesday report from the independent Legislative Analyst’s Office (LAO) estimates a $31 billion budget surplus for California next fiscal year, which starts from July 1. Since the state is not officially allowed to spend more tax dollars per Californian than it did in 1979 (adjusted for inflation), it is left with only a few options to use the budget surplus.
These options include offering tax rebates, reducing taxes, supporting schools and community colleges, or using it for certain purposes, such as infrastructure. Hinting on what options the state could go for, Gov. Gavin Newsom said he could “substantially increase” the infrastructure investment, or could send more stimulus checks.
“How we framed that historic surplus last year, similarly, we will frame our approach this year,” Newsom said, adding, "I'm very proud of the historic tax rebate last year.”
Earlier this year, the state Legislature approved tax rebates amounting to $12 billion in the state budget that was also predicted to result in a surplus.
The tax revenue for California has been rising despite the coronavirus pandemic. For the April to June quarter this year, California businesses posted record taxable sales of $216.8 billion, an increase of over 38% over the same period last year.
Also, the tax collections (on income, sales and corporations) for September were 40% more than September last year and about 60% more than September 2019. A primary reason for record tax collections is the double-digit growth in retail sales.
Whether or not more coronavirus stimulus checks from California would come next year will only be known in January, when Newsom is expected to come up with his budget proposal.
Second Golden State Stimulus Program
California, meanwhile, continues to send out the payment under the second Golden State Stimulus program. As per the California Franchise Tax Board, the most recent batch of payments were mailed on November 15. Further, the CFTB estimates that all the stimulus checks will be sent before the end of the year.
The stimulus checks for the zip codes ending 544-709 would be mailed between November 29 and December 17, while for zip codes ending 710-988, the payment would be sent from December 13. Once the authorities mail the stimulus checks, it could take about three weeks for the payment to show up in mailboxes.
California is sending stimulus checks between $600 and $1,100 under the second Golden State Stimulus program to those with AGI (adjusted gross income) of less than $75,000.