NEW YORK (BLOOMBERG) -- President Donald Trump’s sweeping tariff push is already hitting New York’s economy, with falling Canadian tourism and cross-border shopping driving down sales tax revenue, Governor Kathy Hochul said.
Hochul said the fallout from Trump’s tariff campaign is being felt everywhere from Wall Street to upstate regions like Buffalo, where Canadian visitors regularly boost the local economy through retail spending and attending sporting events.
“Already here’s what we’re seeing — droppings in bookings from Canadians coming to New York State, a huge source of tourism all the way to New York City, but certainly in my hometown of Buffalo,” Hochul said on Bloomberg TV’s Balance of Power on Thursday. “So here’s No. 1 — sales tax revenues are dropping already.”
New York shares a 450-mile border with Canada and has a $50 billion trade relationship with the country, making it especially sensitive to disruptions in cross-border commerce.
“New Yorkers are reeling right now,” Hochul said.
The latest round of tariffs, announced by Trump on Wednesday, includes a baseline 10% duty on imports and then higher rates for 60 nations. Separate 25% tariffs on Canada and Mexico for imports that aren’t covered by separate trade agreements were imposed last month, sparking anger north of the border and boycotts on US goods and travel. Meanwhile, Trump’s 25% tariff on auto imports took effect Thursday, and in response, Canadian Prime Minister Mark Carney imposed retaliatory duties on American-made vehicles.
A New York State Comptroller report last month said that certain industries would likely be impacted by tariffs more than others. Health care, retail and manufacturing in the state would likely see an uptick in costs of goods used by those businesses, the report found. Bars and restaurants, which typically operate on thin margins, would, too.
While Hochul said there could be a “silver lining” if tariffs eventually bring back manufacturing jobs to industrial centers like Syracuse and Rochester, she added, “I don’t know how old I’m going to be when that happens.”
Hochul said her administration is looking at ways to use state resources to help ease the financial burden on residents and stabilize the economy.
In Thursday’s interview, Hochul declined to comment on embattled Mayor Eric Adams’ decision to drop out of the Democratic primary and run as an independent in this year’s mayoral election. A federal judge has dismissed, with prejudice, a criminal case against the mayor, meaning the charges can’t be refiled.
“No matter who is sitting in that seat that the voters of New York decide they want me to work with, I will do that,” Hochul said.
— With assistance from Mark Schoifet