Just read in The Kiplinger Letter that some states including "N.Y. are monitoring small businesses to make sure they're not hiding income or siphoning off sales taxes." I have no regard for tax cheaters, but I'm not sure this is going to get our state out of the deficit hole that it and we are circling on our way down the proverbial drain.
One suggestion for dealing with uncontrolled spending seems to be gaining traction - a tax cap. This has been talked about it Albany for some time, but has not met with favor from the powers that be. Gubernatorial candidate Andrew Cuomo has just come out in favor of capping property tax growth at 2% or the rate of inflation - whichever is lower. This would apply to all school districts and local governments, including fire and other special districts. I think this idea is going to be a mainstay of the debate both for the Governor's seat and for many legislative seats this November.
My good news is that I have every expectation that Tompkins county will show significant growth when the census figures come in. I'm hoping for about 7% growth over 10 years, which would put us a little over 103,000 people, but I'm absolutely positive that our numbers will come in over 100,000--at least 5%. This will make us eligible for a few additional federal programs.
Tuesday, July 27, 2010
Wednesday, September 9, 2009
Sales Tax Revenue Distribution in Tompkins County
I was just recently asked to explain how sales tax revenues in Tompkins County are dispersed among the City of Ithaca, and the Towns and Villages within the County. (I’d like to thank David Squires, the Finance Director, for his help in providing a clear and accurate statement when I asked for assistance.)
Let’s imagine that you buy a power tool or a small kitchen appliance for $100. You’ll also pay $8 in sales tax. Whether you buy the item in the City of Ithaca, Trumansburg, Lansing, or Dryden, New York State will get half of the 8 percent tax or $4. Which municipalities receive the remaining $4 depends on where you buy the item.
The revenue collected from the 4 percent “local” tax is divided among the County, the City of Ithaca, and Town and Village governments. It is split into two distinct pools: the 3 percent pool and the 1 percent pool.
From the 3 percent pool the County receives one-half of all tax collected both inside and outside the City. If you shop in the City, the City would get the other half of the 3 percent. If you do your shopping outside the City, the tax would be collected and distributed by shares according to population among the Towns and Villages. The City receives its portion directly from the State. The County receives and distributes the other shar
The remaining 1 percent pool is divided somewhat differently. When the sales tax was raised from 7 to 8 percent in 1993, a new distribution policy was established. From this pool, the County receives a three-quarter share of all revenues collected both inside and outside the City. The City receives the other quarter from purchases made within the City. The other municipalities receive one-quarter of the revenues collected outside the City, and these are again distributed according to population.
So if you bought a power tool for $100 in the City of Ithaca and paid $8 in sales taxes, the State of New York would receive $4, the County government would receive $1.50 from the 3 percent pool and 75 cents from the 1 percent pool for a total of $2.25, and the City government would receive the remaining $1.75. However, if you bought a $100 item outside of the City—in Lansing, or Dryden, or any of the other Towns or Villages—the State would again get $4, the County $2.25, and the remaining $1.75 would be divided among the Towns and Villages by population regardless of the community where you shop. The Town of Caroline has about 4 percent of the County’s population so it would get about 7 cents. The Town of Ithaca, with about 25 percent of the County’s residents, would receive about 43 cents of the $1.75.
It’s interesting to note that successful retail development within the City directly benefits the City’s revenues through both sales taxes and property taxes. Retail development outside the City is more likely to benefit the host community through increased property taxes since sales tax receipts are based on population rather than the location of the sale.
Let’s imagine that you buy a power tool or a small kitchen appliance for $100. You’ll also pay $8 in sales tax. Whether you buy the item in the City of Ithaca, Trumansburg, Lansing, or Dryden, New York State will get half of the 8 percent tax or $4. Which municipalities receive the remaining $4 depends on where you buy the item.
The revenue collected from the 4 percent “local” tax is divided among the County, the City of Ithaca, and Town and Village governments. It is split into two distinct pools: the 3 percent pool and the 1 percent pool.
From the 3 percent pool the County receives one-half of all tax collected both inside and outside the City. If you shop in the City, the City would get the other half of the 3 percent. If you do your shopping outside the City, the tax would be collected and distributed by shares according to population among the Towns and Villages. The City receives its portion directly from the State. The County receives and distributes the other shar
The remaining 1 percent pool is divided somewhat differently. When the sales tax was raised from 7 to 8 percent in 1993, a new distribution policy was established. From this pool, the County receives a three-quarter share of all revenues collected both inside and outside the City. The City receives the other quarter from purchases made within the City. The other municipalities receive one-quarter of the revenues collected outside the City, and these are again distributed according to population.
So if you bought a power tool for $100 in the City of Ithaca and paid $8 in sales taxes, the State of New York would receive $4, the County government would receive $1.50 from the 3 percent pool and 75 cents from the 1 percent pool for a total of $2.25, and the City government would receive the remaining $1.75. However, if you bought a $100 item outside of the City—in Lansing, or Dryden, or any of the other Towns or Villages—the State would again get $4, the County $2.25, and the remaining $1.75 would be divided among the Towns and Villages by population regardless of the community where you shop. The Town of Caroline has about 4 percent of the County’s population so it would get about 7 cents. The Town of Ithaca, with about 25 percent of the County’s residents, would receive about 43 cents of the $1.75.
It’s interesting to note that successful retail development within the City directly benefits the City’s revenues through both sales taxes and property taxes. Retail development outside the City is more likely to benefit the host community through increased property taxes since sales tax receipts are based on population rather than the location of the sale.
Wednesday, February 11, 2009
First stab at blogging
Here's a stab at a blog from me:
Dear Readers:
Okay, okay, people tell me that I should start a blog. Write down my thoughts, muse a little on the state of the universe, and share it with the folks (as Bill O'Reilly would say). So here's a first shot at it.
I've been thinking about the need to buy local, especially now when we see our national economy faltering and even our own local economy has a few dents. So, it's time to Buy, Live, Give Local on Valentine's Day and everyday--Please purchase your Valentine's Day gifts locally. No need to go to floralextravaganza.com or some such site. If you're considering flowers, jewelry, books or a card, buying dinner at a restaurant, or purchasing a gift certificate for a spa for your valentine, please consider our local merchants. Or make a donation to United Way or one of our local not-for-profits to honor your valentine. Here's a link to the Chamber's membership list: http://www.tompkinschamber.org/sitemanage/view/65 or call the Chamber for a referral to one of our great member businesses and organizations.
If you don't know the difference between the House and Senate versions of The Stimulus Package, here's a quick comparison of the House and Senate versions from the Senate's Chairman of the Committee on Finance. http://finance.senate.gov/press/Bpress/2009press/prb021009c.pdf
And for an important state issue, have a look at Attorney General Andrew Cuomo's proposal to streamline government by making it possible to do government consolidation in this state. http://www.oag.state.ny.us/media_center/2008/dec/dec11b_08.html But the cool thing is the interactive map of NY State that shows you the total number of government entities in each county in our state: www.oag.state.ny.us
Dear Readers:
Okay, okay, people tell me that I should start a blog. Write down my thoughts, muse a little on the state of the universe, and share it with the folks (as Bill O'Reilly would say). So here's a first shot at it.
I've been thinking about the need to buy local, especially now when we see our national economy faltering and even our own local economy has a few dents. So, it's time to Buy, Live, Give Local on Valentine's Day and everyday--Please purchase your Valentine's Day gifts locally. No need to go to floralextravaganza.com or some such site. If you're considering flowers, jewelry, books or a card, buying dinner at a restaurant, or purchasing a gift certificate for a spa for your valentine, please consider our local merchants. Or make a donation to United Way or one of our local not-for-profits to honor your valentine. Here's a link to the Chamber's membership list: http://www.tompkinschamber.org/sitemanage/view/65 or call the Chamber for a referral to one of our great member businesses and organizations.
If you don't know the difference between the House and Senate versions of The Stimulus Package, here's a quick comparison of the House and Senate versions from the Senate's Chairman of the Committee on Finance. http://finance.senate.gov/press/Bpress/2009press/prb021009c.pdf
And for an important state issue, have a look at Attorney General Andrew Cuomo's proposal to streamline government by making it possible to do government consolidation in this state. http://www.oag.state.ny.us/media_center/2008/dec/dec11b_08.html But the cool thing is the interactive map of NY State that shows you the total number of government entities in each county in our state: www.oag.state.ny.us
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