California Deficit Seen Rising by $15 Billion as Revenue Drops

California’s deficit is likely to rise 26% to $73 billion as new data show that tax receipts fell short of earlier estimates, according to the state’s budget adviser.

The new projection for fiscal 2024-25 anticipates the deficit will grow by $15 billion from previous estimates after traditional corporate tax collections declined by more than 33% in December from the year-earlier period, the state’s Legislative Analyst’s Office said in a report released Tuesday. The LAO, as the agency is commonly known, also said California’s income tax withholding and estimated payments have been “fairly weak” as of late.

“If the budget problem ...