Counties and New York State have seen stagnation or
reductions in sales tax revenues due to a combination of factors, including the
Great Recession that began in 2008 and a dramatic increase in online retail
activity in which sales tax collection is not required. Brick and mortar retail
stores in communities across the state have seen a reduction in retail
activity, with some closing and laying off New Yorkers who work in their stores
and live in our communities. In order to deliver essential public services,
counties rely on sales tax receipts to offset property taxes, while also providing
a significant revenue source for cities, towns, school districts and villages
through sales tax sharing arrangements. Today's ruling has implications for our
local governments and their ability to best serve our communities. Stephen
Acquario, Executive Director of the NYS Association of Counties (NYSAC), said, "Today's
decision by the U.S. Supreme Court is a common sense, practical, modern
application of taxation to the new economy. The Court held that requiring
remote seller to collect and remit sales tax to the state where the purchase
was made is not an undue burden on interstate commerce, and as such, states
have the right to require the tax for on online, out of state, sales.
According to the court, 'it is an inescapable fact of modern
commercial life that a substantial amount of business is transacted with no
need for physical presence within a state in which business is conducted.'
At a time when nearly every cent of property tax collected
locally is used to fund state-mandated services, the sales tax is the only
remaining revenue that can used to fund critical life-saving local public
safety programs, infrastructure, and other programs for seniors and
veterans."
