ALBANYThe U.S. Census Bureau released today data on state and local governments' finances for fiscal 1999, with the most commonly used comparative data showing New York's "tax gap" with other states essentially unchanged from the previous year.
Combined state and local taxes in New York totaled $4,515 per person in 1999, according to the new Census data. That was 50.9 percent above the average for all states, and - as was the case in 1998 - second in the nation, behind Connecticut.
The Census Bureau is the authoritative source of financial data on all 50 state and local governments. The Public Policy Institute, The Business Council's research affiliate, analyzed Census data to compare taxes and spending in New York with those in other states.
For most of the 1980s and 1990s, New York's "tax gap" - the extra cost of state and local taxes in the Empire State, compared to the average of all states - ranged from 55 percent to 67 percent. From 1995 through 1998, it declined each year. The 1999 figure released today is one-tenth of a percentage point higher than the 1998 figure, 50.8 percent.
Robert B. Ward, director of research for The Public Policy Institute, cautioned that the per-capita tax figures probably overstate New York's tax burden in the late 1990s. The 2000 population census showed the number of New York State residents significantly higher than the Census Bureau had previously estimated. The per-capita tax figures for 1999 and most other years rely on the Census Bureau's earlier estimates of population. If the population estimate for any given year is lower than the actual population, the actual per-capita tax burden would be lower than the reported figure.
The Census Bureau released its 1998 tallies of state and local taxes earlier this summer. Generally, the agency issues such reports once every year or so. Over the past year, the bureau has increased the frequency of its reports on taxes, making them more timely.
Using another common measure of comparative tax burdens that relates total tax collections to personal income, New York's state and local governments collected $140 in taxes for every $1,000 in personal income in 1999. That figure was down from $142 a year earlier. By this measure, the combined tax burden in New York was the highest in the nation in 1999, and 27.6 percent above the national average.
New York is one of only two states where local taxes total more than those collected at the state level. In 1999, local taxes added up to $2,388 for every resident in New York, while taxes imposed directly by Albany averaged $2,127 per capita.
"New York is more competitive for business and jobs today because Governor Pataki and the Legislature have cut taxes," said Daniel B. Walsh, president of The Business Council and CEO of the Public Policy Institute. "But there is more to do."
Government spending in New York is significantly higher than in most other states, the Institute's analysis found. Overall state and local spending totaled $8,844 per person, 48 percent higher than the national average. In the two largest spending areas, New York's social-services expenditures were 74 percent higher, and education spending was 17 percent higher, than the per-capita average nationally.
The Institute's analysis of the new Census data also showed:
- Both personal-income taxes and corporate-income taxes in New York are more than twice as high, on a per-capita basis, as the national average.
- Property taxes in New York averaged $1,361 per person, 54 percent above average.
- General sales tax collections per capita were 14 percent higher than average in New York. Sales and gross receipts taxes on utilities were 83 percent higher, on a per-capita basis, than the US average.
- State and local government debt in the Empire State totaled $9,420 per person, 88 percent higher than the national average.