Rising sales tax revenue helped boost Erie County budget for this year and is expected to help offset costs in next year's proposed 2019 budget.
But the credit doesn't go to Canadians crossing the border to shop. Both Comptroller Stefan Mychajliw and County Executive Mark Poloncarz agree that based on Canadian bridge traffic numbers, our neighbors to the north aren't the ones spending more here.
It's local residents. Mychajliw said their increased confidence in the local economy is due to President Trump.
“The Trump tax cuts are working," the comptroller said in a statement. "Our sales tax numbers that balanced our budget are proof.”
In reaction to Poloncarz budget highlights in The Buffalo News, Mychajliw also said that despite the falling tax rate, overall spending is projected to grow. Since 2012, county spending increased by more than $177 million, and families paid $42 million more in Erie County property taxes, he said.
Canadian border traffic into the United States is down, meaning fewer Canadians are shopping here. That suggests rising sales tax growth is the result of greater local confidence in the economy and higher spending by local residents.
Sales tax revenue for 2018 shows a 4.5 percent increase in collections, about $5.7 million more than projected, according to projections released by the Comptroller's Office.
Mychajliw credits all of the growth in local spending and sales tax revenue to the federal tax cut passed by the Republican-led Congress and signed into law by President Trump in 2017, which he said "jump started" a national economic boom.
The Republican tax plan kicked in beginning in January, resulting in lower witholding from employee paychecks, though the full impact of the savings won't be felt until after residents file their 2018 taxes.
The tax-code overhaul lowered the corporate rate to 21 percent from 35 percent. The Wall Street Journal reported earlier this month that a new survey of 152 companies by executive-recruitment firm Korn Ferry International found that 14 percent were putting part of their tax-cut savings into base salary increases.
A poll of 1,500 companies by consulting firm Mercer LLC showed 4 percent are redirecting tax savings to budgets for bigger paychecks in the coming year, according to the newspaper.
Poloncarz, who released his $1.5 billion proposed budget Friday, credits the improved local economy to strategic economic planning, and public and private investment in the region.