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SD 3937

Department of Revenue April 2026 Monthly Report

194th Legislature (2025-2026)

The state projects FY26 net tax revenue below the 62F cap by about $5.5 billion, with 4% surtax excluded from the cap.

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Bill Summary · SD 3937

Summary of SD 3937 (Session 194th) – Department of Revenue April 2026 Monthly Report

This bill pertains to the Massachusetts Department of Revenue’s (DOR) April 2026 Monthly 62F report, which analyzes year-to-date net state tax revenue, projections for the remainder of FY26, and whether net state tax revenue may exceed the allowable limit established by Chapter 62F.

Main purpose and intent

  • To document and communicate DOR’s year-to-date net state tax revenue for the current fiscal year (FY26), provide projections for the remainder of the year, and assess whether net state tax revenue might exceed the allowable state tax revenue under Chapter 62F.
  • To certify, per statute, how 4% income surtax revenue interacts with 62F limitations (not subject to those limitations).

Key provisions and changes

  • Reports covered:
    • Year-to-date net state tax revenue for FY26 (excluding 4% income surtax revenue).
    • DOR’s projection of total net state tax revenue for the full FY26.
    • DOR’s projection of allowable state tax revenue for FY26.
    • DOR’s assessment of the difference (or shortfall) between projected net state tax revenue and allowable state tax revenue.
  • 4% income surtax exclusion:
    • The 4% income surtax revenue is explicitly not subject to the allowable state tax revenue limitations under Chapter 62F, per subsection (d) of section 2BBBBBB of section 17 of chapter 29.
  • Exhibit-based projections:
    • Exhibit 1: Year-to-date net state tax revenue (excluding 4% surtax) as of 4/30/2026: $35,672,767,992.
    • Exhibit 2: Estimate of the allowable state tax growth factor for FY26: 1.0405620 (based on wage data and projections).
    • Exhibit 3: Estimated allowable state tax revenue for FY26: $48,266,193,259. Exhibit 4: Estimated FY26 net state tax revenue and the projected difference to allowable revenue: a shortfall of $5,506,482,961 (i.e., net revenue projected to be below allowable revenue by that amount, after excluding the 4% surtax).
  • Projections:
    • DOR projects FY26 full-year net state tax revenue (excluding 4% surtax): $42,759,710,298.
    • The above, when compared to the estimated allowable FY26 revenue: $48,266,193,259, indicates the net state tax revenue is not expected to exceed the allowable amount; rather, it is projected to be below by about $5.5 billion.
  • Exhibit 1 totals by tax type (as of 4/30/2026) show the breakdown of major revenue sources (Income, Sales and Use, Corporate, Deeds, etc.) contributing to the year-to-date figure.
  • Certification and oversight:
    • The bill references the ongoing requirement for the State Auditor to independently determine, by September, whether net state tax revenues exceeded allowable revenues for the preceding fiscal year, per Chapter 62F.

Who or what would be affected

  • State fiscal planning and budgeting, particularly the interaction between net state tax revenue and the 62F cap.
  • State Comptroller and Auditor oversight, since annual certification of 62F compliance remains applicable.
  • Agencies that rely on DOR’s tax revenue projections for budgetary planning, including the Executive Office for Administration and Finance and the Legislature’s Committees on Revenue and Ways and Means.

Procedural and timeline aspects

  • The report is labeled as April 2026 Monthly 62F Report and includes data through April 30, 2026, with projections for May–June 2026.
  • The document is circulated to key fiscal and legislative offices (House Clerk, Senate Clerk, Chairs of the Joint Committee on Revenue, and Chairs of Ways and Means).
  • Statutory references:
    • Section 5 of Chapter 62F (as amended by Acts of 2023) governs the DOR reporting.
    • Subsection (d) of section 2BBBBBB of section 17 of Chapter 29 clarifies the treatment of 4% surtax revenues under 62F.
    • Chapter 62F requires annual certification by the State Auditor regarding whether net state tax revenues exceeded allowable revenues.

Notable figures from the April 2026 report

  • Year-to-date net state tax revenue (excluding 4% surtax): $35,672,767,992.
  • Estimated full-year net state tax revenue (excluding 4% surtax): $42,759,710,298.
  • Estimated FY26 allowable net state tax revenue: $48,266,193,259.
  • Estimated difference: Net state tax revenue is projected to be below allowable by $5,506,482,961.
  • 4% income surtax revenues are separately tracked and not counted toward the 62F cap.

If you’d like, I can pull out a concise one-page briefing with the key numbers and a quick interpretation for policymakers.

Compiled from official sources — confirm details with the bill’s official record.

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