New York State Legislature's Lack Of Tax Extension Means Revenue Risks For New York City And State Local Governments

NEW YORK (S&P Global Ratings) June 27, 2017--On June 21, the New York State Legislature adjourned without extending various sales mortgage recording, hotel and motel taxes, which affect 53 counties and four municipalities across New York State, including a base broadening of the New York State sales tax. (See "Uncertainty Looms Over County Budgets In New York State Following Unresolved Tax Provision Extension," published June 27, 2017, on RatingsDirect.) In addition, the effect on New York City's personal income tax (PIT) after Dec. 31 is that the base rate of 3.4% would be reduced, and the 14% surcharge would be eliminated. We note that the state legislature will likely return before the expiration dates and authorize the taxes at current

...NEW YORK (S&P Global Ratings) June 27, 2017--On June 21, the New York State Legislature adjourned without extending various sales mortgage recording, hotel and motel taxes, which affect 53 counties and four municipalities across New York State, including a base broadening of the New York State sales tax. (See "Uncertainty Looms Over County Budgets In New York State Following Unresolved Tax Provision Extension," published June 27, 2017, on RatingsDirect.) In addition, the effect on New York City's personal income tax (PIT) after Dec. 31 is that the base rate of 3.4% would be reduced, and the 14% surcharge would be eliminated. We note that the state legislature will likely return before the expiration dates and authorize the taxes at current rates before they expire, but if it doesn't we believe New York City risks losing a portion of this tax revenue. Without the extensions, overall tax revenues for New York City's general fund will decline. Specifically, New York City's Transitional Finance...

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