New York experienced one of the biggest declines in tax revenues of any state during the first quarter of 2009, when the overall plunge in state tax collections was the worst on record, according to the latest State Revenue Report from the Rockefeller Institute.
From January through March, New York’s total collections in the major categories of personal income, corporate and sales taxes were down 17 percent, compared to a national decline of 11.8 percent. Only four states fared more poorly by that measure. New York’s decline was concentrated in personal income taxes, on which we are more dependent than most states; on the other hand, the Empire State’s 5.7 percent first-quarter decline in sales tax revenue was actually less severe than the national average of 8.3 percent.
New York looked even worse in the most recent tax collection category reported by Rockefeller Institute for the 50 states: April estimated income tax payments, dominated by investment and business income among high-income taxpayers.
The 52.1 percent year-to-year decline in estimated tax payments in New York State in April was more than double the national average decline of 22.3 percent. Only Indiana did worse, with a drop of 64.5 percent. By comparison, neighboring New Jersey and Connecticut experienced estimated payment declines of 36.2 percent and 37.5 percent, respectively, while California’s estimated payments were off only 27.2 percent. This is yet another reflection of New York’s heavy dependence on wealthy taxpayers even before the soak-the-rich income tax hike enacted with the 2009-10 budget.
The full table, from page 6 of the report, is reproduced below.