When you see a story about tax hikes these days, your thoughts probably immediately turn to Joe Biden and the congressional Democrats. And that would be a fair assumption. But the swamp isn’t the only place where big tax increases are on the way. That state government of New York is currently working overtime to dig deeper into everyone’s pockets on top of the expected federal tax increases. Governor Andrew Cuomo took time out of his busy schedule of dodging sexual harassment allegations and lying about the number of body bags coming out of nursing homes to coordinate with the legislature on a plan that will make some New Yorkers the proud bearers of a new title: the most heavily taxed citizens in the United States. (Wall Street Journal)
New York Gov. Andrew Cuomo and state lawmakers are nearing a budget agreement that would increase corporate and income taxes by $4.3 billion a year and would make top earners in New York City pay the highest combined local tax rate in the country.
Democratic leaders of the state Assembly and Senate briefed legislators on Saturday on the tax plan, which was one of the last pieces of a roughly $200 billion state budget, people familiar with the deal said. The additional tax revenue would be used to increase school aid and create new funds for undocumented immigrants, small businesses and tenants who are behind on their rent, the people said.
Legislators were briefed on a plan under which income-tax rates would rise to 9.65% from 8.82% for single filers reporting more than $1 million of income and joint filers reporting more than $2 million, the people said.
The team has made good on an earlier threat to create the equivalent of a “wealth tax” in New York City while keeping the process inside of the standard income tax system. New Yorkers earning more than a million dollars will pay 9.65 %. Those earning more than five million will jump to 10.3% and those coming in at more than 25 million will have the privilege of paying Albany 10.9%. When combined with the state’s base income tax of $3.88%, the top earners will be paying a total of 14.8%, making them the most heavily taxed workers in the nation, even higher than the 13.3% that the wealthy pay in California.
And where will some of these new streams of revenue be going? Three of the items mentioned were additional aid for the schools that are still refusing to open, rental assistance for delinquent tenants, and (wait for it…) funds for illegal aliens. Yes, it’s a fabulous “free money” giveaway for all of the Democrats’ favored groups.
The end result of all of this should be both obvious and predictable. The state, and New York City, in particular, are already hemorrhaging population like a worker who slips while using a chainsaw. The state was already leading the nation in out-migration at the end of last year. This unwelcome development will see some of the most successful people on Wall Street and across the financial sector (the ones who already pay a ton of taxes to keep things running) packing their things and heading for friendlier destinations. When they go, the real estate market will take yet another hit, as fewer people with the wealth to afford Manhattan properties will remain.
And what happens when a state or city’s tax base shrinks? There’s less revenue to pay for fundamental services such as the police. We’re watching a slow-motion implosion of the Empire State taking place before our eyes. And taking recent history as our guide, there’s no indication that the people in charge have a clue as to what they’re dragging their own constituents into.