Gov. Andrew Cuomo wants to divert some of the revenue from the proposed expansion of the state’s internet sales tax collections to towns and villages affected by aid cuts in his budget plan.
The plan, according to a source, is in the governor’s 30-day budget amendments. Towns and villages would receive a portion of the internet sales tax revenue to make up for the proposed cuts to Aid and Incentives for Municipalities.
Cuomo’s budget proposal would cut AIM funding by $59 million, from $715 million to $656 million. The administration claimed the cuts would affect local governments that are less reliant on the aid.
The towns and villages that would lose the aid disagree. Many of the municipalities have already passed budgets for this year, which means they would have to make up the lost revenue if AIM funding is slashed.
Cuomo acknowledged the concerns this week when he revealed that he was reconsidering the AIM funding cut.
“In these tough times, it is a big effort for them,” Cuomo said at an Albany news conference.
In his executive budget, Cuomo renewed calls for collecting sales tax on internet marketplace purchases. The Division of Budget reported that $280 million in local sales taxes is owed on purchases made through internet marketplaces, such as Amazon and other retailers.