State Tax Collections Fall Even Further, Wilson Told : Revenue: Controller says December receipts were down 14% compared to 1989. A $7-billion-to-$8-billion shortfall is now seen.

State Controller Gray Davis sent Gov.-elect Pete Wilson more bad budget news Thursday, announcing that state collections are running even lower than previous estimates.

Davis, after a preliminary accounting of December tax receipts, said business taxes during the Christmas month were down nearly 14% compared to last year.

“December’s revenue figures were anemic,” Davis said in announcing the tax collection figures. “This is a very bad omen and darkens the state’s financial picture.”

Even before the release of Davis’ tax report, state officials were facing a budget shortfall conservatively estimated at $6 billion over the next 18 months. The budget problem is being blamed in large part on the downturn in the economy. In addition to drying up tax collections, the bad economy is said to be contributing to a larger than expected demand for health and welfare services.

Just how big the problem eventually will get remains to be seen, but budget officials now are privately talking about a $7-billion-to-$8-billion funding gap--the difference between the amount it will cost to provide for the existing level of state services and the money available to pay for them.

Wilson will be sworn in on Monday, and then will unveil his first budget on Thursday. The new budget will contain the state Department of Finance’s first official update on the fiscal situation since last summer.

Wilson aides so far have been tight lipped about what the governor-elect’s budget will show. Press Secretary Bill Livingstone declined comment on how much of a shortfall Wilson is expecting, but discounted a published report that put the figure as high as $10 billion.

Davis, who serves as chairman of the Franchise Tax Board, said the decline in business taxes during December was offset by an 8.1% increase in personal income tax revenues and a 3.9% jump in sales tax collections.

Overall, net tax collections during December were running 2% over last year.

Business, personal income and sales taxes provide about 90% of the state’s annual budget revenues.

For the first six months of the budget year, which runs from July 1 to June 30, tax collections were running 3.8% ahead of last year’s pace. The problem is that the current $55.7-billion state budget assumed a 7% growth in tax collections. Even budget projections showing a $6-billion gap were based on revenue growth of 5%.