Res 0166-2022

Whereas, The outbreak and spread of COVID-19 has devastated the small business economy; and Whereas, As New Yorkers sheltered in place to stop the spread of the virus, businesses in New York City (NYC) experienced massive declines in revenue; and Whereas, According to State Comptroller DiNapoli, the restaurant industry in NYC still employs around 54,000 fewer workers than it did in February 2020; and Whereas, The retail industry in NYC still employs around 39,000 fewer workers than it did in February 2020; and Whereas, As small businesses across the City have experienced decreases in revenue, thousands of businesses have been forced to close; and Whereas, Since the start of the pandemic over 26,300 businesses have closed permanently; and Whereas, Nearly 90 percent of those closures were businesses with fewer than ten employees; and Whereas, The closure of small businesses has hampered the City's recovery from the pandemic; and Whereas, While small businesses in NYC have completely reopened since their closure, many business owners are still dealing with the economic impact of the pandemic; and Whereas, Unless specifically exempted, the state and local sales tax applies to retail sales of tangible personal property and to certain services; and Whereas, In New York City, a local sales tax has been imposed with a total sales tax rate of 8.875 percent, which includes the City local sales tax rate of 4.5 percent, the state sales tax rate of 4 percent and the Metropolitan Commuter Transportation District surcharge of 0.375 percent; and Whereas, The Urban-Brookings Tax Policy Center has recognized tax holidays as an effective tool in stimulating short-term sales by providing relief to taxpayers; and Whereas, The New York State (NYS) Legislature has previously recognized the usefulness of suspending certain taxes to provide relief to NYS residents; and Whereas, As part of the passage of the NYS budget, a gas break from June 1 through December 31 was implemented to temporarily remove 16 cents per gallon in state taxes; and Whereas, Small businesses in NYC are the cornerstone of neighborhoods across the five boroughs, employing over half of NYC's private sector workforce and beautifying commercial corridors; and Whereas, Given small businesses continue to face a difficult financial environment, NYS must take action to support the welfare of small businesses; and Whereas, The suspension of sales tax for a period of time would increase small business revenues by decreasing the price consumers pay for certain products; now, therefore, be it Resolved, That the Council of the City of New York calls upon the New York State Legislature to pass, and the Governor to sign, a temporary tax holiday suspending sales tax to boost sales for small businesses across New York City. NM LS #7257 5/5/2022