ALBANY — New York state is facing an unexpected $2.3 billion shortfall — the most significant in eight years — due to a sharp drop in income tax collections for December and January, state Comptroller Tom DiNapoli and Gov. Andrew M. Cuomo revealed on Monday.

The governor, who had announced his $175 billion spending proposal for 2020 last month, cast blame on the federal government, attributing the drop largely to the 2017 federal rollback of the state and local tax deduction, known as SALT, which he said was designed to penalize Democratic "high-tax" states.

"Everything we did economically is right," Cuomo said Monday. "We tightened our belt, we cut taxes, we're creating jobs, and here's a penalty just because we are Democrats."

The federal tax measure, which placed a $10,000 cap on SALT deductions, went into effect last year. Cuomo said the majority of homeowners impacted chose to file their 2017 taxes early to take advantage of the benefit before the change went into effect.

Because of this, the state anticipates that the full fallout of the SALT cap will be felt in 2019.

"This is the most serious revenue shock New York has faced in many years," DiNapoli said. "And that $2.3 billion figure will frankly get worse before it gets better."

DiNapoli cited anecdotal reports of New Yorkers leaving the state or changing their primary residence and Wall Street volatility as factors in the revenue gap.

The current spending plan only accounts for a $1.7 billion dip in tax collections over two years.

The combined state and local tax rate for high-income New Yorkers is the second highest in the nation. Due to New York's progressive tax structure, the top one percent of earners account for nearly half of the state's income tax revenue.

Those are the same New Yorkers impacted by the SALT cap, according to Cuomo.

It is not the largest budget deficit Cuomo has had to contend with. In 2011, during the governor's first year in office, the state made deep cuts to school aid and other programs to close a $10 billion budget gap.

DiNapoli and Cuomo were joined at their news conference by Robert Mujica, director of the New York State Division of Budget. They said they are still evaluating how to absorb the shortfall but declined to say whether the state would increase taxes or cut back services.

Senate Minority Leader John J. Flanagan, in a statement, said that he fears Democrats will use the deficit as an excuse to increase taxes on middle-class New Yorkers.

"We cannot allow this to happen," Flanagan said. "It's imperative that we balance the budget without resorting to tax increases, enact the spending cap into state law, and make the property tax cap permanent to bring certainty to homeowners and seniors. Budgeting is about choices; and it's time for Gov. Cuomo and legislative Democrats to make the right ones."

Dave Friedfel, director of state studies at the Citizens Budget Commission, said the state could do more to increase its reserve funds and account for the possibility of an economic recession.

"While true that the governor has increased reserves since taking office, the projected balance of $2.3 billion is not enough to weather the extreme volatility caused by our dependence on high-income New Yorkers with extremely volatile incomes," he said. "Even a mild recession would be expected to create a $20 billion deficit over four years – and that's if spending remains flat."

The announcement comes as Democrats in the Legislature are pushing for significant increases in state funding for housing, healthcare and school aid in next year's budget.

While Cuomo and DiNapoli were outlining the state's financial predicament, state legislators were rallying with advocates nearby in the Capitol calling for a $100 million investment in child care subsidies.

"We can find enough money to do this right," said Assemblywoman Mary Beth Walsh, a Ballston Republican.

Sen. James Skoufis, an Orange County Democrat, said it would be "penny wise and pound foolish" to skimp on spending on child care, despite the budget crunch.

Last July, New York, Connecticut, Maryland and New Jersey filed a federal lawsuit in Manhattan that seeks a court order overturning the $10,000 federal tax cap. The states, in a recent court filing, said the cap "deliberately seeks to compel certain states to reduce their public spending." The multi-state coalition cast the measure as an "unconstitutional assault on the states’ sovereign choices."

The lawsuit is pending and the Justice Department, which is defending the U.S. Treasury and Internal Revenue Service, is scheduled to file its response to the litigation later this month.

David Lombardo contributed to this report.