LOWVILLE, New York (WWNY) – As prices go up, so does the amount of tax you pay on that item. And that has local governments collecting more money.
At least a couple of counties in the north country are ahead of schedule when it comes to collecting sales tax this year. On paper, that’s a good thing. But in reality, counties, too, are paying more because of inflation.
“That sales tax, you know, continues to come into the county at a higher rate during inflation,” said Lewis County Manager Ryan Piche.
The Bureau of Labor Statistics reported last week that prices are up across the nation by 8.6% from a year ago. That’s the fastest increase since December 1981. Consumers are feeling the pain at the pump and the cash register.
Prices are rising and so are the collections of sales tax. Lewis County budgeted for $12.85 million in sales tax revenue in 2022.
“So at this point, the county has received 24% more in sales tax than we did at this point last year,” said Piche.
That’s a difference of a little more than a million dollars through mid-May.
But Piche says the extra money is a double-edged sword because a lot of the projects that the county wants to do are now a lot more expensive.
“Our operations are costing more as well, so we’ve got capital projects that have come in 200% to 300% of what we had expected,” he said.
Piche points to a project to fix up sidewalks near the courthouse. The county had budgeted $100,000 for the project, but bids are coming in at $163,000.
St. Lawrence County is seeing the same trend. Board of Legislators Chairman Bill Sheridan says county sales tax revenue is up 12% from last year through the first quarter, but a lot of that extra money is used for county expenses.
“I know that, you know, we’re going to see an increase in the cost in fuel for example to plow the roads and so forth,” he said.
Sheridan says extra money from sales tax will go into the fund balance, and the county can use that money for any necessary projects.
In Lewis County, even though projects and general expenses are costing more, Piche says the county will stay within its budget.
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