LANSING, Mich. (AP) — Michigan’s short-term budget outlook became even rosier Friday, when economists revised projected tax revenues upward by a combined $5 billion over two years.

The new estimates will be used by Democratic Gov. Gretchen Whitmer and the Republican-led Legislature to finalize the next state spending plan. Both sides want to cut taxes but differ over how to do it.

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Revenues in the school aid and general funds for the current fiscal year are $3 billion higher than was forecast in January. For the 2022-23 budget year, they are up $2 billion from the estimate four months ago.

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“At a time when we’re seeing very good news today, I think we just have to continue to maintain a fair sense of caution as we look at the medium- and longer-term as we’re dealing with really unprecedented territory in this uncertain economy,” state Treasurer Rachael Eubanks said.

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