Sales tax for the 3rd quarter increased this year in New York by double-digit percentages. A large reason for that is a lot of pre-pandemic activities in New York City, like going to see shows at the theater and going out to eat at restaurants are becoming normalized again.
Large Increases in Revenue
Comptroller Tom DiNapoli’s office announced on Thursday that sales tax collections grew by over 10% in comparison to the same period last year. Most of this growth was largely in part due to the “re-normalization” of life in New York City. All in all, sales tax during the third quarter hit a whopping, $5.7 billion which was an increase of over $500 million from the last quarter. The big increase in sales tax over the past year has been due to an increase in customers who are willing to go out and do things in a public setting.
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NYC is Back
However, there is bad news when it comes to the revenue increase. The increase in revenue is not keeping pace with the current rates of inflation overall for New York counties, and cities outside of New York City. “New York City’s sales tax growth in the third quarter, after relatively weaker collections in 2020 and 2021, bolstered overall growth for the state,” Comptroller DiNapoli said. “Most local governments are experiencing sales tax revenue growth, even as they struggle with higher costs from inflation just like consumers and businesses. We will continue to monitor how inflation is affecting local governments and the state’s economy.”
New York has been struggling to retain the jobs lost during the initial lockdown period due to the pandemic, however, in September the City saw Broadway and hotel attendance rates climb back to pre-pandemic levels of above 90%.
Wrap Up
The good news here is that NYC seems to be reaching its pre-pandemic level in the tourism and hospitality industries. However, still not seeing revenues across the state to be able to combat the steady rise of inflation we have seen over the last year.