Local Sales Tax Growth First Half of 2018

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Local Sales Tax Growth First Half of 2018 Robert Caracciolo, Research Analyst Division of Local Government and School Accountability 1 Topics Summary of local sales tax in New York Statewide and

1 Local Sales Tax Growth First Half of 2018 Robert Caracciolo, Research Analyst Division of Local Government and School Accountability 1 Topics Summary of local sales tax in New York Statewide and regional trends County and city sales tax collections Per capita collections Factors and influences Recent Supreme Court decision 2 Local Sales Tax in New York Sales tax is administered by the State Counties and cities can impose General (goods and services) Limited (hotel occupancy or consumer utilities) Tax rates are between 3 and 4.75 percent Many counties share a portion of their collections with cities and towns within their borders 3 1

2 Statewide Growth Year-Over-Year Percentage Change in Local Sales Tax Collections by Half-Year 15% 10% 5% 0% -5% -10% -15% 10.6% Recession -9.0% 5.7% 1.6% H H H H H H H H H H H H H H H H H H H H H % Sources: New York State Department of Taxation and Finance, w ith calculations by the Office of the New York State Comptroller (OSC). Notes: Includes New York City (NYC). Adjusted for correction adding $238 million to collections for NYC in calendar year Local sales tax collections in the first half of 2018 totaled $8.5 billion This marks a 6.0 percent, or $484 million, increase over the same period last year Growth in the first half of 2018 was the highest halfyear increase since Regional Analysis Percentage Change in Local Sales Tax Collections by Region, First Half 2017 to First Half 2018 Seven out of ten regions had growth of at least 5.0 percent Statewide: 6.0% 5.6% 5.8% 4.8% 3.1% 5.0% 5.8% 4.5% 5.5% 5.8% 6.9% Collections were particularly strong in some upstate regions: Capital District, Mohawk Valley and Southern Tier Capital District Central NY Finger Lakes Mohawk Valley North Country Southern Tier Western NY Long Island Mid-Hudson New York City Upstate Downstate Sources: New York State Department of Taxation and Finance, w ith calculations by OSC. Includes county and city sales taxes. Growth was stronger than in the first half of 2017 in all regions except the Finger Lakes 5 New York City Collected $3.9 billion in local sales tax, a 6.9 percent increase over the same period last year Highest increase in collections since the first half of 2013 Strongest growth of any region Accounted for 45.3 percent of the total local sales tax collections statewide 6 2

3 County Collections In the first half of 2018, collections grew in 54 of the 57 counties outside of NYC, with an average growth rate of 5.1 percent Strongest growth: Hamilton County (38.9 percent) Sullivan County (18.0 percent) Weakest growth: Cayuga County (-5.8 percent) Oswego County (-1.9 percent) 7 City Collections In addition to NYC, 17 cities impose their own general sales tax All but three of these cities experienced growth in collections in the first half of 2018, with an average growth rate of 5.7 percent Strongest growth: Gloversville (33.2 percent) Weakest growth: Oneida (-10.1 percent) 8 Collections Per Capita Local sales tax collections per capita were $426, an increase of $24 over the same period last year Highest per capita: Suffolk County ($506) New York City ($485) Lowest per capita: Washington County ($158) Orleans County ($200) 9 3

4 10 Factors and Influences State s unemployment rate for June 2018 was 4.5 percent, the lowest in over a decade Wage growth has remained mostly steady, slightly outpacing last year Consumer confidence is high, spending is slightly up and tourism is strong Inflation increased by 2.9 percent in June 2018 over June 2017; highest growth in 7 years 11 Motor Fuel Collections Year-Over-Year Percentage Change in New York State Gas Prices and Motor Fuel Sales Tax Collections by Half-Year 40% 30% 20% Gas Prices (New York) Motor Fuel Sales Tax Motor fuel sales tax component increased by 13.9 percent for the third consecutive halfyear period 10% 0% -10% -20% -30% -40% H H H H H H H H H H H H H H H H H H H Source: New York State Department of Taxation and Finance, Office of Tax Policy Analysis; United States Department of Energy, Energy Information Administration; w ith calculatinos by OSC. Note: Half-year gas price changes are based on an average of monthly prices. Upstate regions are affected more by motor fuel collections Closely related to the growth and decline of gas prices 12 4

5 Supreme Court Decision The U.S. Supreme Court s ruling in South Dakota v. Wayfair reversed prior decisions States may now have the authority to require all online retailers to collect and remit sales taxes on goods and services New York already collects sales tax from many of the largest online retailers, but could see additional revenue gains Links and Contacts Local Sales Tax Report for the First Half of /first-half-2018-local-sales-tax-collections.pdf Questions or Inquiries localtraining@osc.ny.gov 15 5

6 Thank You Division of Local Government and School Accountability 16 6

Local Sales Tax Growth Annual Collections for 2018

Local Sales Tax Growth Annual Collections for 2018 Robert Caracciolo, Research Analyst Division of Local Government and School Accountability 1 Topics Summary of local sales tax in New York Statewide and