Sales tax revenue for local governments in April plummeted 24.4 percent compared to the same period last year, a report released Tuesday by New York State Comptroller Tom DiNapoli's office found.
The sharp decline in revenue is the latest sign of the COVID-19 pandemic's toll on the health of the economy in New York and on local governments. This, in turn, could lead to cuts in spending for local governments or an increase in taxes elsewhere to make up the lost revenue.
Sales tax collections in April totaled just over $1 billion.
“The coronavirus has hurt household finances, and the April sales tax figures show how deep it is cutting into municipal finances,” DiNapoli said. “Sales tax revenues are vital for the counties and cities that are on the front lines of fighting the COVID-19 pandemic. They are the first responders and provide a safety net of services for New Yorkers. The federal government needs to provide assistance to those hit hard by this virus or the budget cuts could be severe in some communities.”
The drop in revenue was the most severe in the mid-Hudson Valley at 21.5 percent and the Albany area, which saw a 28.8 percent drop.
The first phase of the economic reopening is scheduled to begin Friday, and three regions of the state -- the Mohawk Valley, Finger Lakes and Southern Tier -- are expected to hit the first qualifying benchmarks.
Non-essential businesses have been closed since March, which in turn has led to thousands of layoffs and job furloughs.
At the same time, people are traveling less, resulting in declining gasoline sales.