Angry New Yorker

Tuesday, May 06, 2003
Taxing Til We Drop, by By E.J. McMAHON (See also NY Fiscal Watch.)

"BY any standard, the revenue bill passed by the state Legislature last week was a real blockbuster - raising taxes on a scale that would dwarf anything enacted during the rolling fiscal crisis that punctuated Gov. Mario Cuomo's tenure.

  • If the Senate and Assembly muster enough votes to override Gov. Pataki's expected veto, New Yorkers will be hit with at least $5.4 billion in new taxes over the next three years. That's $1.8 billion more than the total amount of new taxes imposed during the last five years of Cuomo's tenure.

  • During the 2003-04 fiscal year alone, the Legislature is seeking to raise state personal-income, business and sales taxes by a total of $3 billion. By comparison, the worst tax hike enacted under Cuomo was less than half as large - valued at $1.25 billion in 1990-91.



"May 5, 2003 -- The ink was barely dry on the fiscally ruinous tax-and-spend bill passed Friday by the state Legislature when the gloating began. * * * * Class warfare is self-defeating. Because people whose pockets are constantly being picked do something about it. They stop working, and investing, if they can't keep the fruits of their labor.
Or they go away. From New York, for instance. Consider the impact of Friday's action:

  • Nearly every broad-based tax - on income, purchases, business activity, name it - will go up. Astronomically.
  • Top income-tax rates rise 12.4 percent (from 6.85 percent to 7.7 percent).
  • State sales tax climbs 6.25 percent (from 4 percent to 4.25 percent).
  • Spending sets a record: $93 billion.
  • In Gotham, as McMahon notes, combined city and state income tax would rise to a whopping 11.35 percent - the highest in America, and double the rates of neighboring states.
  • And a city income-tax hike already agreed to - but not yet passed - will push that rate to well over 12 percent.
  • Perhaps worst of all, the state plan calls for borrowing some $4.2 billion, cash that won't be available next year

* * * *

Meanwhile, Mayor Bloomberg was pleased as punch with the new arrangements - even though much of it will come from his own constituents:

  • The city's portion of the sales tax - currently 4.25 percent - rises about 3 percent (to 4.37 percent). On top of the state sales-tax hike, the total will soar to 8.62 percent in the city.
  • The separate city income tax would also rise, particularly on the rich.

BUT while Mayor Mike rejoices ("It's going to be a wonderful day and a nice weekend," he said Friday), city-dwellers should mull this: Bloomberg sold this year's property-tax hike by promising an offsetting income-tax reduction. Now, under the Bruno-Silver-Bloomberg plan, not only would Gothamites get no offsetting tax cut; they'd actually be hit with four big added hikes - in the city sales tax, the state sales tax, city income tax and state income tax. " [more]

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