Comptroller’s report shows New York’s state finances in strong position

(The Center Square) – New York ended the first quarter of the fiscal year on a strong note as the monthly State Cash Report, published by State Comptroller Thomas DiNapoli on Friday, showed tax receipts beating budget projections by nearly $5 billion.

According to the report, the state collected $30.9 billion in personal income, consumption, business and other taxes for the three-month period ending on June 30. That’s nearly $17 billion more than New York received for the same quarter last year. However, there is a significant caveat to that.

DiNapoli noted in a release announcing the report that the tax deadline extension last year due to the COVID-19 was a key reason for the drastic increase. In 2020, the April 15 tax deadline was pushed back to July 15. This year’s deadline was extended as well, but for only a month, which kept it in the first quarter.

The led to the state reporting $22.2 billion in personal income tax payments, an increase of $13.5 billion from the same quarter last year.

The tax deadline changes also affected the state’s General Fund balance. At $15.5 billion through the end of June, the balance exceeds the 2021-22 budget plan by $5.8 billion and is up from the nearly $7 billion balance reported last year.

At $4.8 billion, consumption and use taxes jumped up 43.4% from last year and exceeded the budget forecast by $571 million. Business taxes for the quarter, totaling $3.2 billion, were more than double the 2020-21 first-quarter tally of $1.5 billion and more than $600 million better than planned.

In a statement, DiNapoli said the combination of better than projected tax collections and billions in federal COVID-19 funds means the state has a chance to improve its fiscal health.

“The state should use these revenues to bolster reserves or for pay-as-you-go funding for critical infrastructure projects,” he said.

While collections were higher than projections for the quarter, spending was actually below budget for the quarter. The $46.4 billion in all funds spending was $2.4 billion less than projected.

Three weeks ago, the Comptroller’s Office released a report indicating the state’s cumulative four-year budget gaps have shrunk by more than $35 billion to $3.4 billion.

DiNapoli said the post-shutdown economic recovery along with the federal relief helped reduce the deficit. Other factors include tax increases targeted at high-income earners and new revenue streams, including recreational marijuana and mobile sports betting. The last two indicators were part of the budget package the state legislature passed in April.

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