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City Sales Tax Revenues Following State Trend

Sales tax revenue numbers are up throughout the state, but are lagging behind 2018 percentages.

Earlier this month, Thomas P. DiNapoli, state comptroller, released a report about how local sales tax growth has slowed during the first half of 2019 than in 2018.

“Rising sales tax collections are very important for New York’s local governments. But recently, these revenues have been growing more slowly,” DiNapoli said.

“These latest results should remind officials to closely watch future collections and plan accordingly.”

Collections during the first and second quarters grew by 3.4% and 3.2%, respectively, over the same periods in 2018.

In comparison, 2018 collections for the early quarters grew by 4.8% and 7.2% over the same periods in 2017.

In the city of Jamestown, sales tax revenues in the first quarter were down 1.89% compared to 2018. In the second quarter, city officials saw a 6.19% increase over 2018’s second quarter. Both quarters combined, the city’s sales tax revenues increased 2.34%.

Comparatively speaking city officials saw a 3.92% increase in the second quarter of 2018 over 2017 numbers. Through the first half of the year in 2018, the city had received 5% more sales tax revenues than in 2017.

According to the comptroller’s report, most of the economic factors that typically explain overall sales tax collections — such as wages and consumer spending — grew at a modest pace. However, a decrease in gasoline prices in the first half of 2019 caused a drop in the portion of taxes collected from the sale of motor fuels.

The weakness in 2019 growth is even more pronounced at the county level, with collections in 15 mostly upstate counties declining from the same period last year. By comparison, collections declined in only three counties in the first half of 2018 compared to the same period in 2017.

Chautauqua County sales tax revenues increased by 2.3% in the first half of 2019 compared to 2018.

To view the full report, visit osc.state.ny.us/localgov/pubs/research/2019-local-sales-tax-collections.pdf.

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