Bitter-Sweet Albany Deal Is $3 Billion Tax Break for Wealthiest New Yorkers

NEW YORK, NY (12/07/2011)(readMedia)-- The New Deal for New York is disappointed in the tax structure agreed to by Governor Cuomo, Assembly Speaker Silver, and Senate Majority Leader Skelos. The New Deal has long fought for a progressive tax structure in New York and while the proposal as distributed by the governor's office does look like progressive taxation, it is actually more regressive than the system currently on the books. In addition, it falls far short of the $5 billion in revenues that would be raised under the current tax structure, generating only $2 billion in revenues.

This amounts to a $3 billion tax rebate for the wealthiest New Yorkers. Giving a $3 billion tax break to the wealthiest New Yorkers while leaving a $2 billion revenue shortfall, and calling it "fairness" is nonsense.

To give a $3 billion tax break to the richest 1% -- to hand back $3 billion of the existing $5 billion surcharge – it is clear the glass is more than half empty. In fact, a joint filer making one million dollars will receive a windfall under this plan, with a rate plummeting from 8.97% to just 6.85% -- a 25% decrease in rate paid. Those in New York's 99% will be forced to shoulder this massive tax cut for millionaires.

Compared to the current tax code (i.e., under the "millionaire's tax"), married/joint taxpayers earning between:

- $40,000 and $150,000 get a 0.4% rate cut

- $150,000 and $300,000 get a 0.2% rate cut

- $300,000 – $500,000 get a 1.0% rate cut

- $500,000 – $2,000,000 get 2.12% rate cut

- $2,000,000+ get 0.15% rate cut

In other words:

- A family making $50,000 a year will get less than $200 a year in tax cuts

- A family making $100,000 a year gets less than $400 a year in tax cuts

- A family making $1,000,000 a year gets more than $20,000 a year in tax cuts, or $408 PER WEEK

Of the $2 billion that would actually be generated under this plan, $0.5 billion would be redirected for offsets to the MTA payroll tax and flood relief, leaving about a $2 billion revenue shortfall going into the next year's budget talks. Our communities have been hit increasingly hard as year-after-year budget cuts have weakened the programs and services we rely on and can not face another cuts-only budget in this coming year. Additional revenues should be raised in the new year, through mechanisms such as closing corporate loopholes and needless expenditures or additional modifications to the personal income tax structure.

Over the coming days, the New Deal groups will continue to review the other elements of Governor Cuomo's New York Works agenda, including the job creation efforts which appear to be weak tax credits, not deeper efforts that can work to address root causes. Over the coming months, New Deal groups will continue to organize for tax fairness, full funding for the programs and services our communities rely on, and aggressive job creation programs, such as Jobs Trust Fund, that can serve to address New York's dramatic income inequality.

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The New Deal for New York is currently led by the following grassroots organizing groups:

• Community Voices Heard (CVH), in New York City, Yonkers, Newburgh and Poughkeepsie
• Niagara Organizing Alliance for Hope (NOAH), in Niagara County
• People United for Sustainable Housing (PUSH), in Buffalo
• Syracuse United Neighbors (SUN)
• VOICE-Buffalo, in Erie County
• Voices of Community Activists and Leaders (VOCAL)-NY, in New York City, Westchester and Albany