States Grappling With Hit to Tax Collections

COVID-19 has triggered a severe state budget crisis. While the full magnitude of this crisis continues to unfold, state revenues are declining precipitously and costs are rising sharply, with many businesses closed or operating at reduced hours and millions of people recently unemployed. Due to the economy’s rapid decline and uncertainty about its future path as well as possible federal aid, official state revenue projections likely do not yet fully reflect the unprecedented fiscal impact of the coronavirus pandemic.