New York State Tax Revenue Below Forecast as Wall Street Slowsby
First Quarter tax revenue was $450 million below projections
State Comptroller Thomas DiNapoli urges caution on budget
New York Comptroller Thomas DiNapoli said the state’s tax collections fell $454.1 million below projections in the first quarter as personal income tax income revenue dropped amid a slowdown on Wall Street.
The Empire State collected $19.8 billion in taxes for the period ending June 30, a 3.9 percent decline from the same period last year. Personal income tax collections of $13.3 billion were $598.7 million below projections, according to the comptroller’s June cash report. The state’s fiscal year started April 1.
“Personal income tax collections are off to a slower than expected start,” DiNapoli said in a news release. “While it’s early in the year and tax collections may improve going forward, the state should be prepared to take action if revenue remains below estimates.”
More pain may be in store. Three of Wall Street’s biggest investment banks, Goldman Sachs Group Inc., JPMorgan Chase & Co. and Morgan Stanley slashed their first-half compensation pools for employees by the most in at least four years, Bloomberg News reported Wednesday.
New York’s budget is tied closely to Wall Street’s fortunes. In the last fiscal year, taxes paid by the richest 1 percent of New York taxpayers were expected to generate 43 percent of personal income-tax receipts or 27 percent of total state taxes, according to the Empire Center for Public Policy, a research group that advocates for less government spending.
Sales tax and business tax revenue came in a combined $126.4 million higher than projected.