ALBANY — Sales tax collections, an important source of revenue for local governments, rose a brisk 6.3% in New York in the quarter ending September 30 compared to the same period a year earlier, new state government data shows.
Of the 57 counties outside New York City, 51 posted gains in tax collections, with the six counties that experienced a drop located in upstate rural regions, according to the figures released by state Comptroller Thomas DiNapoli’s office.
The higher collections overall could reflect the fact that the state in June expanded its efforts to impose taxes on purchases from internet retailers that previously were not charging sales taxes to New York consumers.
Advocates for widening the spectrum of businesses subject to sales tax argued it levels the playing field to provide greater fairness to brick-and-mortar stores that continue to remit sales taxes to the state.
Aides to DiNapoli said a breakdown of where the sales tax revenue is coming from and how much of it is from internet sales has not yet been made available to them by state tax officials.
Counties where sales tax declined were reported in the third quarter of this year included: Delaware and Schoharie counties, both of which border Otsego County, and Essex, Hamilton, Livingston and Fulton counties.
A variety of factors can influence sales tax receipts, including tourism trends, weather-related events, the price of gasoline and fuel oil and whether consumers are spending on furniture and cars, said E.J. McMahon, research director for the Empire Center for Public Policy, an Albany think tank.
“The tax source that is the most variable for local governments is the sales tax,” McMahon said.
The tax collections, which represent a major revenue source for county governments, are more prone to annual fluctuations than relatively steady property tax collections, he said. As a result, a drop in sales tax collections can put upward pressure on county property taxes.
Otsego County had a gain of 5.6 for the third quarter, helping to bring its gain for the first nine months to 3.2%. In both categories, it fared better than several surrounding counties.
Delaware dropped by 4.3% for the first nine months, though for the third quarter it posted an increase of 4.5%. The comptroller’s office said the dip in Delaware County, as well as declines in Hamilton and Fulton counties, are linked to accounting adjustments made to earlier tax collection reports.
Schoharie County, which continues to recover from devastating floods in 2011, sagged 0.7% in the initial nine months of the year, and was down 0.9% for the third quarter
In general, the mosaic of numbers appeared to tell a tale of two New Yorks, with the downstate economy humming along while taxable sales activity upstate was less brisk. Of the various upstate regions, only the Capital District, with growth of 4.3%, matched the statewide average increase for that period of 4.3%, the data shows.
Yates County had the highest increase, year over year, posting a 9.3% jump, a phenomenon that was left unexplained in the report. Meanwhile, Westchester County, one of the affluent suburbs of New York City, recorded a year-over-year increase of 7.3%.
Joe Mahoney covers the New York Statehouse for CNHI’s newspapers and websites. Reach him at email@example.com.