Local sales tax collections continued to climb in 2018, growing for the third year in a row, according to a report released today by State Comptroller Thomas P. DiNapoli. Collections across the state of $17.5 billion grew by $872 million, or 5.3 percent.

“Local sales tax collections grew at a faster pace in 2018 than in recent years, boosting local revenues,” DiNapoli said. “Despite the good news, a slowdown in collection growth in the fourth quarter shows that sales tax revenue can be unpredictable. Local officials should keep a watchful eye on consumer spending and this revenue source and be prepared to react accordingly.”

Every region in the state has experienced an increased annual growth rate in sales tax collections in each of the last three years, with the exception of the Finger Lakes (which slowed from 4.9 percent in 2017 to 3.7 percent in 2018).

Year-over-year growth was especially strong in several upstate regions. The Southern Tier saw the highest year-over-year increase at 6.8 percent, the strongest for the region since 2011. The North Country had the second highest (5.9 percent), followed by the Mohawk Valley (5.8 percent). Downstate, the Long Island and Mid-Hudson regions saw collections grow by 4.5 percent and 5.1 percent in 2018. Notably, Central New York has seen a significant turnaround in its collections, climbing 5.1 percent in 2018, having been the only region with a decline in collections (-0.9 percent) in 2016.

New York City’s sales tax collections grew by 5.7 percent. The city’s increases have typically been robust over the past several years.

For the 57 counties outside of New York City, collections grew in 55 of them. Sullivan County experienced the largest increase (16.4 percent), followed by Tioga and Hamilton counties (16.1 percent). Collections were down in 2018 in Cayuga (-1.3 percent) and Madison (-0.7 percent) counties.

All but one of the cities with their own sales tax experienced an increase in year-over-year collections in 2018. Gloversville had the strongest growth (17.8 percent), along with the cities of Norwich (12.8 percent) and Salamanca (8.3 percent). Oneida was the only city that saw its collections decrease (5.2 percent), mostly due to technical adjustments.

Two proposed changes to the state sales tax, including one related to the taxation of sales through online marketplaces – such as Amazon - have the potential to drive millions of dollars in additional sales tax revenues to local governments.

Read the report, or go to: https://www.osc.state.ny.us/localgov/pubs/research/2018-local-sales-tax-collections.pdf

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