MTF expects tax revenues to increase by $1.54 billion to $29.73 billion in FY 2022, a $1.54 billion or 5.5 percent increase from the most recent FY 2021 projection of $28.19 billion. The Massachusetts Taxpayers Foundation FY 2022 forecast is $1.68 billion more than the Baker administration’s revised FY 2021 revenue benchmark of $28.05 billion announced Friday, December 11, representing a 6.0 percent year-over-year increase.

The four key assumptions/risks upon which the forecast relies: the speed with which Americans are vaccinated, the size and breadth of a federal relief package, the state’s ability to overcome several labor market hurdles, and the nature of a post-pandemic economic recovery. All four factors will affect the future economic and tax revenue growth.