Ulster moves to continue levying extra 1% sales tax

Ulster County lawmakers again are turning to the state for permission to continue levying the county’s extra 1 percent sales tax.

The county Legislature is expected to take up a measure in February, asking the state to take the first step in the process of extending the tax by drafting a “home rule” request that gives the county authority to continue levying the tax.

Under state law, counties are permitted to impose a 3 percent sales tax. They can get approval from the state to exceed that 3 percent, but the authority must be approved periodically by the state Legislature.

Generally, the state grants twoyear extensions, though in 2017 it extended the authority for three years. That authority expires Nov. 30.

Ulster County has charged the additional 1 percent sales tax since 2002. Before that, the county had an additional 0.75 percent sales tax.

In addition to the county sales tax, the state levies a 4 percent sales tax, making the total sales tax paid currently by Ulster County consumers 8 percent.

Neighboring Dutchess County levies an additional .75 percent sales tax on top of the 3 percent allowed by law, however consumers in that county also must pay an additional three-eighths of 1 percent Metropolitan Transit Authority tax, bringing the total sales tax there to 8.13 percent.

Ulster County expects to take in $128,561,423 in sales tax revenue in 2020. The additional 1 percent accounts for $32,143,056 of that total.

Under revenue-sharing agreements with the towns and city of Kingston, the county divvies among those municipalities 14.5 percent of the total sales tax revenue collected. In 2020, that amount is expected to be $18,424,331, leaving the county with $110,137,092. The additional 1 percent sales tax accounts for $27,480,004 of the county share.

Sales tax is the largest single source of revenue for Ulster County. In 2020, it made up 37 percent of the $342.9 million county budget.

If the “home rule” request is approved by the county Legislature, legislators then must find state lawmakers in the Assembly and Senate to sponsor the bill in Albany.

If state approval is granted, county lawmakers then must vote again to formally extend the 1 percent tax.