ALBANY, N.Y. — Local-government sales-tax collections rose 19 percent to $19.6 billion in 2021 from $16.5 billion in the prior year. That’s according to a report that New York State Comptroller Thomas DiNapoli released Feb. 9. The growth in collections represented the “highest annual increase on record after a historic low in 2020” when local […]
ALBANY, N.Y. — Local-government sales-tax collections rose 19 percent to $19.6 billion in 2021 from $16.5 billion in the prior year.
That’s according to a report that New York State Comptroller Thomas DiNapoli released Feb. 9.
The growth in collections represented the “highest annual increase on record after a historic low in 2020” when local sales-tax collections declined 10 percent, DiNapoli’s office said. That followed 4.7 percent growth in 2019.
“The pandemic substantially changed consumer spending for goods and services and from brick and mortar to online,” the comptroller said. “While local sales-tax collections were robust in 2021 as the economy rebounded from the pandemic, some of that growth is attributed to inflation, which was the highest it has been in over 30 years. If inflation remains high, consumer spending on many taxable goods could decrease due to the rising cost of basic staples.”
After a decline of 3.9 percent statewide in the first quarter of 2021, local sales-tax collections grew nearly 50 percent in the second quarter and “remained strong” for the rest of the year, with 20 percent growth in the third quarter and an 18.7 percent gain in the fourth quarter.
New York City’s collections did not rebound to 2019 levels until the fourth quarter of 2021, well behind the rest of the state, which recovered to pre-pandemic levels by the third quarter of 2020.
New York City’s collections did grow faster than the rest of the state in the third quarter (27.9 percent) and fourth quarter (26.3 percent) of 2021 when compared to 2020. In comparison, sales-tax collections rose 14.2 percent and 12.8 percent, respectively, in those quarters for communities outside of New York City in 2021 in contrast to 2020.
Nearly every county in the Empire State posted double-digit growth in 2021, with more than one-third of them exceeding 20 percent. Sullivan County generated the highest growth at 31.5 percent, followed by Orange County (25.5 percent) and Schuyler County (22.9 percent).
Only Oswego County had growth below 10 percent in 2021, DiNapoli’s office said.
Of the cities that impose their own sales tax (not including New York City), Saratoga Springs had the strongest year-over-year increase of 32.5 percent, followed by Norwich (27.8 percent) and Ithaca (23.4 percent).
The report also examines the pandemic’s impact on consumer spending in the state. The taxable sales for many key sectors, including retail trade and manufacturing, appear to have returned to pre-pandemic levels, but some rebounded faster than others, and the recovery in New York City has been different than the rest of the state, DiNapoli’s office said.
