Tax Revenue Forecasting Documentation April, 2013

312 Pages·2013·24.74 MB·English

Office of Management
and Budget
TAX REVENUE FORECASTING
DOCUMENTATION
Financial Plan Fiscal
Years 2012–2016
The City of New York
Michael R. Bloomberg
Mayor
Office of Management and Budget
Mark Page
Budget Director
Michael Dardia
Deputy Director
TAX POLICY, REVENUE FORECASTING
& ECONOMIC ANALYSIS TASK FORCE
Joshua Goldstein
Assistant Director
[phone]
Rodney Chun
Chief Economist
[phone]
Fax
[phone]
Office of Management
and Budget www.nyc.gov/omb
Photos by:
Mae Mortel
Scott Domansky
City of New York
O
and Budget Office of Management and Budget
255 Greenwich Street, New York, NY 10007-2146
Mark Page
Director
April 22, 2013
TO OUR READERS
The City Charter requires that the Office of Management and Budget
(OMB) publish documentation of forecasting methodologies used for projecting
tax revenues for those taxes which account for five percent or more of total City tax
revenues. The following taxes meet this criterion: the real property tax, the personal
income tax, the general corporation tax and the sales and use taxes. In order to aid
the public to better understand the City’s tax base, non-Charter mandated taxes
have been included in this report as well.
OMB staff use the forecasting models detailed in this report, applying the
latest economic forecasts and tax collection data available, to project tax revenues for
the City’s budget and financial plans. This report also includes the latest updates to
the tax law.
I hope this report serves as a valuable aid to public understanding of our
forecasting methodologies.
Sincerely,
Mark Page

TAX REVENUE
FORECASTING DOCUMENTATION
FINANCIAL PLAN
Fiscal Years 2012–2016
Table of Contents
Introduction................................................................................................................1
Economic Forecasting.................................................................................................5
Charter Mandated Taxes
. Real.Property.Tax..................................................................................................17.
. Personal.Income.Tax..............................................................................................35
. Sales.Tax................................................................................................................47.........................................
. General.Corporation.Tax.......................................................................................55
Non-Charter Mandated Taxes
. Banking.Corporation.Tax......................................................................................67.
. Unincorporated.Business.Tax.................................................................................75.
. Real.Property.Transfer.Tax.....................................................................................85.
. Mortgage.Recording.Tax........................................................................................91.
. Commercial.Rent.Tax............................................................................................97
. Utility.Tax...........................................................................................................103.
. Hotel.Room.Occupancy.Tax...............................................................................109.
. Cigarette.Tax.......................................................................................................115
. Other.Taxes.........................................................................................................119
Appendices
. I..Real.Property.Tax.............................................................................................I-1
. II..Personal.Income.Tax.......................................................................................II-1
. III..Sales.Tax........................................................................................................ III-1
. IV..General.Corporation.Tax................................................................................IV-1
. V..History.of.Tax.Collections...............................................................................V-1
. VI..State.and.Local.Tax.Rates.............................................................................. VI-1

INTRODUCTION
As mandated by the New York City Charter, this Although this document focuses on structured
report documents the forecasting methodology for approaches, this does not signify that developing
each tax revenue source which represents five percent the tax forecasts is purely a mechanical process. The
or more of total New York City tax revenue. The taxes methodologies described in this report are the tools
which meet this requirement are the real property, used to develop the forecast. The results which these
personal income, sales and general corporation taxes. models produce are supplemented by information
Beginning 2007, non-charter mandated taxes have derived from analysis of tax collections as well as
been included in this report. judgments concerning many factors, both economic
and behavioral.
Tax Revenue Forecast - January 2013 Plan
($ in Millions)
Fiscal Year
Taxes 2012 (Actuals) Share 2013 (Forecast) Share
Real Estate-Related Taxes:
Real Property $17,946 42.6% $18,440 41.8%
Commercial Rent 630 1.5 653 1.5
Real Property Transfer 912 2.2 1,036 2.4
Mortgage Recording 537 1.3 656 1.5
Income-Based Taxes:
Personal Income 7,953 18.9 8,488 19.3
General Corporation 2,447 5.8 2,493 5.7
Banking Corporation 1,278 3.0 1,361 3.1
Unincorporated Business 1,637 3.9 1,763 4.0
Consumption and Use Taxes:
Sales and Use 5,813 13.8 6,061 13.8
Utility 371 0.9 382 0.9
Cigarette 67 0.2 63 0.1
Hotel 476 1.1 502 1.1
All Other 514 1.2 506 1.1
Subtotal* $40,579 96.4% $42,404 96.2%
Tax Audit Revenue 743 1.8 838 1.9
STAR Aid 790 1.9 829 1.9
Total* $42,111 100.0% $44,071 100.0%
*Total may not add due to rounding.
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ECONOMIC FORECASTING
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