Solid sales tax boost won’t be enough to close massive budget hole counties across the state will face if state gap not closed

While many parts of New York saw positive news in form of sales tax boosts during the summer months – it won’t be enough to plug the massive holes created by the Coronavirus Pandemic.

Sales tax receipts return on a delay, and as part of that – many counties received a fall boost in form of fourth quarter increases. It was millions more than expected in some cases.

However, that’s not going to change the fact that a massive drop in sales tax revenue is looming, and on top of that New York State is threatening to withhold 20% of its returns if federal aid is not passed by Congress and the White House.

At this point, a second COVID relief package is not expected before Election Day. And in November, many budgets across the state will be due.

The state will have to see taxes increased, payments to local government and schools reduced or cut, and vital services reduced.

“To close a $50 billion deficit, which would be a historic deficit, you would have to do all of the above,” Gov. Andrew Cuomo said Sept. 29. “You would have to raise taxes, raise income taxes, number one. You’d have to cut the budget and cut expenses, and you would have to borrow. You’d have to do all three.”

Comptroller Tom DiNapoli says counties have become increasingly reliant on sales tax revenue in recent years. It’s a challenge that some local officials don’t deny.


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