N.Y. Gov. Proposes Cutting Manufacturers' Income Taxes
ALBANY, N.Y. (AP) — Gov. Andrew Cuomo proposed Monday cutting New York's corporate income tax from 7.1 percent to 6.5 percent in the coming year and eliminating it altogether for upstate manufacturers.
"Business is the movement that pulls the train," Cuomo said.
Surrounded by chamber of commerce officials in the Capitol's ceremonial Red Room, he said he wants to make the state's business climate more welcoming, contrary to its longtime reputation as high-tax and anti-business. "You can't beat zero," he said, hoping to bring factories back to the upstate area that many manufacturers left.
Administration officials said a $2 billion state budget surplus will fund the proposed tax breaks. They include state tax credits to offset 20 percent of manufacturers' property taxes, phasing out the state utility surcharge and tax credits for lower-income income homeowners and renters.
"The property taxes in this state are just intolerable," Cuomo said. His proposal could freeze them for two years.
He proposed paying more state aid to any of New York's 10,500 local governments that enforce 2 percent limits on spending increases. In the second year, he proposes using the same financial incentive for municipalities that continue applying that cap and start cutting costs by consolidating services with other towns, villages, cities and counties.
New York has some of the highest property taxes in the nation, with Westchester County first, Nassau County second and Rockland County fourth, the governor said. Measured as a percentage of property values, he said 13 of the 15 highest tax counties in the nation are in upstate New York.
"You just have to reduce that bureaucracy. You can't feed that many mouths every morning," Cuomo said.
The Empire Center for Public Policy noted that statewide there are 3,200 counties, cities, towns, villages and school districts. The remaining 6,000 government entities are mostly sewer and water districts that collect fees for direct services.
The Cuomo administration also proposed reducing the estate tax in New York, among 15 states that have one, by raising the exemption threshold from $1 million to the federal level of $5.25 million and reducing the state tax rate from 16 percent to 10 percent over four years.
State Senate Republican leader Dean Skelos said he was encouraged Cuomo included several of his conference's long-held tax-cut priorities. He also called for a permanent state spending cap.
Assembly Speaker Sheldon Silver said the governor presented "a bold vision" for providing tax relief, but cautioned it should be fair to everyone and that the state should have resources needed to fund health and education programs that he called bedrock of the state's quality of life.
Heather Briccetti, president of the Business Council of New York State, said the importance of tax relief to manufacturers "cannot be overstated. The loss of manufacturing jobs is one of the main reasons the upstate economy has struggled."
Billy Easton, executive director of the Alliance for Quality Education, said the plan has tax breaks for banks and wealthy estate owners with money classrooms need. "The average millionaire estate owner would receive $128,000 in taxpayer subsidies," he said.