Updated: 12/10/2013 12:32 PM
Created: 12/10/2013 3:54 AM WHEC.com
By: Associated Press
Gov. Andrew Cuomo embraced his tax commission's proposal Tuesday for a two-year freeze on what he called crushing local property taxes.
Under the proposal, the state would subsidize the costs of the freeze in 2014 with the first state budget surplus since before the Great Recession. The second year of a freeze would include provisions to encourage local cuts and consolidation of services to yield permanent tax relief, the way Cuomo said state government has done in his three years in office.
"It's good news that we are in a position to frankly have this luxury of deciding how to invest this surplus because we did what we had to," Cuomo said from the commission's Long Island presentation at the State University of New York at Old Westbury.
The report also recommended tax breaks for employers and specifically for manufacturers. The commission also recommended reducing New York's estate tax, which has long been a goal of former Republican Gov. George Pataki, whom Cuomo chose as co-chairman of the commission. Pataki said cutting the estate tax will encourage small-business owners and farmers to stay in New York without fear that their families will be "clobbered" by the estate tax when business are passed on within the family.
Pataki also highlighted the need to let a temporary income tax surcharge on New York's wealthiest residents to expire as planned in 2018. Cuomo and the Legislature have extended that $2 billion-a-year income tax increase twice after Cuomo and Senate Republicans promised to let it end because it was a "job killer."
Cuomo said he will more carefully review the commission's proposals and bring them to the Legislature. Lawmakers could adopt some or all of the ideas in the session beginning in January, the start of the election year for Cuomo and the lawmakers.
Cuomo's priority of holding the line on some of the nation's highest property taxes come as New York City Mayor-elect Bill de Blasio plans to press state legislators to pass a tax hike on wealthy city residents. The Democrat wants the city tax increase to fund his signature campaign promise of providing universal pre-kindergarten programs.
Senator Ted O’Brien: "The recommendations made by Governor Cuomo's tax commission will help lower the tax burden placed on New York's families and businesses. The commission's proposals will bring real property tax relief to our community, accelerate the elimination of the unfair 18-a energy tax and slash taxes for upstate manufacturers. For the upstate economy to grow and provide good paying jobs, we need to lower taxes and reduce the cost of doing business in this region and state."
Unshackle Upstate: "Today's report from the New York State Tax Relief Commission contains several measures that, if enacted, will ease the tax burden of Upstate families and businesses. We applaud Governor Cuomo's continued efforts to rein in state spending and lower taxes. This fall, we released our New ERA for Upstate plan, which highlighted a number of tax cut and economic development proposals to improve the Upstate economy, including reducing the state's corporate franchise tax. We are pleased that the Commission concurs with our assessment and recommends lowering the corporate income tax rate to 6.5 percent and to 2.5 percent for Upstate manufacturers. In addition, we also called for the repeal of the regressive 18a energy assessment and are pleased that the Tax Relief Commission wants to accelerate its elimination. The proposed reforms to the state's antiquated estate tax will also deliver real relief to our legacy of family-owned businesses and farms as well. Unshackle Upstate has long opposed a 'circuit breaker' program as a means of providing property tax relief in that it fails to address the factors that drive up our property taxes. We believe that enacting real, meaningful mandate relief is essential to reducing property taxes for all New Yorkers. We look forward to working with the Governor and the Legislature to advance those changes and revitalize our struggling economy."