Tax revenue in New York continued apace over the last several months, with money coming into the state at a faster clip than expected, Comptroller Tom DiNapoli on Thursday said.
The higher-than-expected revenue from taxes like the personal income tax and consumption and use taxes come against the backdrop of broad concerns the economy may be slowing down and risking a recession.
“Tax collections continued to exceed projections through December,” DiNapoli said. “However, concerns of an economic downturn and a cloudy revenue picture continue to create uncertainty. These conditions reinforce the importance of increasing rainy day reserve funds on or ahead of the schedule proposed in the Financial Plan.”
Tax receipts from the third quarter of the state's fiscal year reached $79.8 billion, nearly $7.7 billion higher than original estimates. Income from the personal income tax reached $42.1 billion, a total that was $8.1 billion more than expected.
Gov. Kathy Hochul, who is set to present her budget plan for the new fiscal year in the coming weeks, has said she does not want to increase taxes in the spending proposal.
Progressive Democrats in the state Legislature, however, are calling for further tax increases on rich New Yorkers, pointing to the potential of an economic downturn and its effects on lower-income people.
New York has been flush with cash since the increase in federal aid due to the COVID pandemic as well as increasing taxes on the highest income earners in the state, allowing the state to in turn significantly increase spending in the budget for education.