FOR RELEASE:

DiNapoli: Sales Tax Collections Worst in Recent History

Weak Performance Expected to Continue This Year

Counties across New York State, including New York City, saw one of the sharpest declines in sales tax collections on record, according to a report released by State Comptroller Thomas P. DiNapoli. The report, which compares 2009 to 2008 collections, found a 5.9 decrease in collections statewide. Only four counties saw an increase but these numbers were primarily due to administrative and technical adjustments, not better economic performance.

“This is yet another sign that the Great Recession is having a continuing impact on our communities across New York,” said DiNapoli. “These numbers are sobering. Fortunately, many local governments have taken sometimes painful budgetary steps to stave off disaster. It’s a struggle, but all levels of government have to make every taxpayer dime count.”

Among the report’s findings:

• Fifty-three of New York’s 57 counties outside of New York City saw a sales tax decline and many of these counties share sales tax revenues with their municipalities;
• The largest decline occurred in the Lower Hudson Valley, at 8.4 percent;
• In state fiscal year 2009-10, the state’s sales tax base (value of all goods and services subject to the sales tax) shrank by 7.1 percent;
• Among New York’s counties, Westchester saw the steepest drop at 10.3 percent;
• The Mohawk Valley region saw the smallest downturn at 2.5 percent;
• Only Oneida, Chautauqua, Schuyler and Seneca counties saw increases, but this growth was mostly attributable to factors other than economic growth; and
• According to the New York State Association of Counties, most counties prudently budgeted little or no growth in their sales tax revenues for 2010.

DiNapoli had cautioned local governments in a 2008 report against over reliance on sales tax revenues, due to their sensitivity to economic downturns. In addition to tracking economic performance in regions across the state, DiNapoli has created a website to allow taxpayers to track financial activities of their local governments.

Resources:

• DiNapoli’s most recent sales tax report
• County by county breakdown
  

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