Sales tax revenue growth in New York State has slowed for the third consecutive month, marking a shift from the stimulus-boosted rise in consumer spending earlier this year.
According to Comptroller Tom DiNapoli’s office, May’s sales tax revenue grew by just 1.1% year-on-year, echoing the sub-2% growth seen in March and April. This sluggish growth trend poses challenges for local governments heavily reliant on sales tax revenue.
Despite New York’s unemployment rate falling below 4% for the first time since early 2020, DiNapoli cautioned local officials about potential fiscal imbalances resulting from modest sales tax collections.
In May, collections totaled $1.7 billion, up from $18.4 million a year ago. While New York City saw a higher increase in sales tax collections than the state overall (3.3%), 47 of the 57 reporting counties witnessed a drop in money collected year-over-year.
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