2024 Sales Tax Report

NYSAC has released its annual sales tax report highlighting the major sectors and industries that provide the most sales tax in each county and important trends to watch. 

What is evident as we move further past the COVID pandemic and its dramatic impact on consumer activity is that annual sales tax growth is returning to pre-COVID levels. The transition will not come without bumps as sales tax growth has slowed dramatically in the first half of 2024 compared to 2023, and NYSAC expects that many counties may actually collect less sales tax in 2025 than 2024.

Another important factor noted in the report is that the Census Bureau has updated the federal industrial classifications system (the NAICS code) that tracks different businesses based on the types of products and services they offer. Major changes have been made to the retail sector with numerous consolidations and eliminations of certain codes including Electronic Shopping & Mail Order (internet-based retail). 

These transactions will no longer be separated out by delivery chain but combined with the sector that makes the most sense based on what they sell, or services they provide. For example, an online-only business that mainly sells clothing will now be placed in the same category as other clothing retailers. These updates will be incorporated in the next release of data from Taxation and Finance which should be out shortly. Going forward, year-over-year comparisons will be more difficult to track in certain cases.