The Mobil gas station on Wolf Road is seen on Thursday. A comptroller’s report found sales tax receipts were up during the first three months of the year across most of the state and in the Capital Region due to higher consumer goods prices.
Larry Rulison/Times Union
ALBANY — A state comptroller’s report found that sales tax revenues by local counties were up during the first three months of 2026, although the full impact of sky-high gas prices on collections remains to be seen.
The war with Iran, which began Feb. 28, has sent prices at the pump soaring amid worldwide oil shortages and trading speculation. A gallon of regular gas in the Capital Region was selling Thursday, on average, for $4.285 per gallon, according to AAA. That’s up 9% in the past month and up 40% over the price of gas a year ago.
Article continues below this ad
The highest average price ever recorded in the Capital Region by AAA came in 2022, amid Russia’s war in Ukraine, when it hit $4.978 per gallon.
State Comptroller Thomas P. DiNapoli issued a report on Wednesday regarding state sales tax receipts. A portion of sales tax is set by and allocated to the counties.
With the state sales tax portion set at 4% of a purchase, most counties in the Capital Region charge an additional 4% sales tax, resulting in a total sales tax rate of 8%. (Warren and Washington counties charge less and have a rate of just 7%.)
Make the Times Union a Preferred Source on Google to see more of our journalism when you search.
Add Preferred Source
DiNapoli’s report found that local government sales tax collections (cities are also included) were $6.1 billion in the first three months of 2026, an increase of 5.1% over the same period last year, when gas was selling for about $3.06 per gallon, on average in the Capital Region, about $1.20 lower than it is today. (The report does not address state sales tax collections and the comptroller’s office did not immediately provide the data to the Times Union, but, in theory, the state collections should mirror those of local governments.)
Article continues below this ad
The increase is notable because it was spread across nine of the state’s 10 regions, and the quarterly increase was higher, in terms of percentage, than first-quarter increases measured last year and in 2024, the report points out.
DiNapoli, in a statement, cautioned that higher tax collections may be masking hidden fractures in the economy.
“Local sales tax collections experienced a substantial increase in the first quarter compared to last year, but growth varied significantly by region,” DiNapoli said. “An economic slowdown due to geopolitical conflicts and federal actions could affect future tax collections, and local governments must be cautious in estimating this revenue.”
The Capital Region saw a 4.3% increase in local sales tax revenue during the first three months of 2026, receiving $258.9 million in sales tax revenue, compared to $248.2 million collected during the same period in 2025.
Article continues below this ad
It’s true that collections varied widely throughout the region and during the three months. For instance, during March, the first full month of the war in Iran, sales tax receipts in the Capital Region rose 7.2%, a huge leap compared to the previous months. But during the same month, in Albany County the increase was 13.3%, and Rensselaer County experienced a 10.9% decrease in sales tax receipts.
That disparity in sales tax collections is difficult to understand. Most county finance departments were just digesting the numbers and the forces behind them.
The DiNapoli report found that the Trump administration’s tariff program drove up consumer goods prices, boosting sales tax collections. The report was less certain about the impact of higher gas prices since gas sales account for just 2.8% of all sales taxes collected in the state each month.
Article continues below this ad
Still, DiNapoli said that was a data point to watch.
“In New York state, average monthly gasoline prices in 2026 were $2.88 per gallon in both January and February before rising to $3.48 per gallon in March, a 20.1 percent jump in just one month and a 15.2 percent increase compared to March 2025,” the report states. “The Comptroller’s Office will continue to monitor sales tax collections and the local effects of the federal government’s economic policies and actions over the remainder of 2026 and beyond.”