Corporate Tax Cut, Property Tax Freeze Top Cuomo Economic Plan
New York Residents and businesses could see reductions and rebates on taxes when Governor Andrew Cuomo forms his new budget proposal. Monday he released details of a rumored $2 billion rebate for property taxpayers...though government leaders at the town, city and county level will have to play ball with Albany to get it for their residents.
Cuomo blames layers of government for driving up homeowners’ tax bills.
“Towns, villages, water districts, sewer districts, fire districts, another district just to count the other districts: We were government crazed in this state and we set up all these subdivisions and all these governmental entities and now they have a life of their own.”
Cuomo is proposing a freeze on residents’ property taxes...as long as local governments pledge to keep their spending growth at two-percent. Albany would refund that difference for up to two years. Cuomo Budget Director Robert Megna explains the benefit would be widespread for municipalities that go along.
“The 2-year property tax freeze is 976 million, close to a $1 billion. It’s available to households outside of New York City with incomes below $500,000 that keep to the property tax cap. In the second year the benefit is only available to local governments that develop a plan for shared services or consolidation of operations.”
By influencing spending and forcing some consolidation, Cuomo believes he can start cutting down on government duplication – and thereby reduce costs and taxes.
His proposal also includes a number of business tax reductions and even eliminates some fees, including most prominently reducing corporate income taxes.
BUSINESS TAX CUTS COULD AID UPSTATE MANUFACTURERS
Just days before his State of the State address (1:30 p.m. Wednesday) and weeks before his budget proposal, Cuomo announced dropping corporate taxes from above 7-percent to 6.5 percent...the lowest it’s been since 1968. He offered further relief for manufacturers, with even more help to upstate.
“Offer manufacturers, who very often have a large property tax bill because they have a large piece of property, a 20% credit where we’ll reimburse 20% of their property tax. We have focused on Upstate New York on top of the overall economic focus because the economic problems of Upstate New York are worse than Downstate New York. We want to reduce the corporate income tax in Upstate New York for manufacturers to zero.”
Of course that news was met with cheers from business groups such as the Manufacturers Association of Central New York and the Business Council. Unshackle Upstate President Brian Sampson says if approved the tax savings remove a burden the state has in attracting businesses.
“We don’t get a chance to make a value proposition to companies and talk about all the wonderful assets we have for doing business in New York. So we’re incredibly encouraged by these tax reduction proposals, especially those that focus on manufacturing, a sector which drive much of the Upstate economies.”
Cuomo’s tax plan also includes eliminating a utility tax businesses have born for years. It also offers the chance for residents to have their property taxes frozen...if localities play along with spending limits and consolidation goals. All the proposals will have to be negotiated in the state budget.