Over a year ago, New York State Gov. Andrew Cuomo told the people of New York that he wouldn’t even consider raising taxes. “No new taxes. No new taxes. No new taxes,” he said in 2010.
And like the first President Bush, it looks like an old dog can learn new tricks.
Twenty-five days before the expiration of the millionaire’s tax, Cuomo announced on Tuesday that he plans on raising taxes on New York State’s wealthiest residents.
Only a very small fraction of the Black community will feel the effects of the tax increase. In fact, word from political insiders is that it was pressure from the Black, Hispanic and Asian Legislative Caucus and unions representing working people that helped change the governor’s mind.
Under the new tax plan, there would be an increase on single filers who make over $1 million annually and a hike on joint filers making over $2 million per year. The hikes would be offset with lower rates for state residents who makes $150,000 or less a year.
According to Cuomo, under the new rate structure, 4.4 million New Yorkers would receive tax cuts, including a $690 million reduction for middle-class taxpayers, All taxpayers would see a tax reduction or no change compared to current their bill. The brackets would increase with the rate of inflation and they would expire on Dec. 31, 2014.
“Our state government has come together in a bipartisan manner to create jobs, grow our economy and, at the same time, enact a fair tax plan that cuts taxes for the middle class,” said Cuomo. “We are investing in projects that will restore our state’s infrastructure and put thousands of people to work. We are cutting taxes on middle-class New Yorkers and small businesses, which will inject nearly $1 billion into our economy. We are targeting new tax credits to hire inner city youth and reduce unemployment in some of the poorest areas of our state, as well as providing direct aid to communities struggling to recover in the wake of this year’s severe storms.” According to the governor, this would be the lowest tax rate for middle-class families in 58 years.
It was the proverbial “three white men in a room” who put together the tax plan. Cuomo collaborated with Assembly Speaker Sheldon Silver and Senate Majority leader Dean Skelos on the agreement. Skelos sent a statement to the media explaining why he, as a Republican, agreed with this proposal. “This comprehensive plan will reduce the tax rate for middle-class families to their lowest levels in more than 50 years, create thousands of new private sector jobs and begin to turn our economy around,” he said.
Cuomo’s plan also includes an inner-city youth employment program and a $25 million tax credit for employers who hire unemployed youth between 16 and 24 years of age over the first six months of next year. Employers in businesses such as clean energy, health care, advanced manufacturing and conservation would be eligible for the credit. They’d receive up to $3,000 for a six-month training period and $1,000 more if workers are retained for an additional six months.
The Legislature was slated to begin a special session Wednesday afternoon to discuss the package for the new tax bill. George Gresham, president of SEIU 1199, released a statement heaping praise on Cuomo and attributing his actions to the power of the Occupy movement.
“We applaud Governor Cuomo, Senate Majority Leader Skelos and Assembly Speaker Silver for their bold leadership during this critical time,” said Gresham. “This agreement will create jobs, cut taxes for the middle class and, for the first time in decades, begin to restructure the tax code towards a more equitable system. The audacity and determination of the Occupy Wall Street movement changed the national dialogue on income inequality and awakened ordinary citizens in New York and around the world that change is needed.”
Gresham also thinks the agreement will mitigate cuts to the social safety net, ensure funding for health care and education and create desperately needed jobs.
Assemblyman Keith Wright felt it was about time Cuomo switched it up to do the right thing by the people of New York. Wright spoke with the AmNews about the necessity of this bill due to current conditions in the urban areas.
“Whether it’s not extending the millionaire’s tax or the overhauling of the tax codes, if it walks like a duck and talks like a duck, it’s a duck,” said Wright. “We need to generate more revenue in the state of New York so programs won’t suffer. People are suffering left and right. They say the unemployment rate is around 8 percent, but in our community-the Black community-I would venture to say it’s about 25 to 30 percent. We need to generate revenue so we can survive.”
Silver worked with Cuomo to see this bill through and also believes that the middle class will greatly benefit from it. “With Governor Cuomo’s leadership, we have forged a bipartisan plan that is fair to all New Yorkers and will help build a brighter economic future for this state,” he said. “I am submitting to my conference a proposal that will provide $2 billion in revenue for the people of New York in each of the next three years by creating a more progressive tax structure, coupled with a significant middle-class tax cut.”
However, not everyone in the political game is happy with the Cuomo plan. Assembly Minority Leader Brian Kolb said Cuomo’s potential tax hike doesn’t address what he feels are the real issues in New York.
“From what has been reported in the media so far, the bottom line is that taxes are being raised in New York State and we are still not dealing with our state’s serious spending problem,” Kolb said in a statement. “There is still no significant unfunded mandate relief for local governments. We should be protecting taxpayers by capping local Medicaid costs, enacting a state spending cap and doing this through an open, public process where these issues are debated and discussed in the light of day, not through secret deals behind closed doors by three men in a room.”