Senator David Carlucci on Wednesday voted to bring a more fair and progressive tax system to New York that will cut taxes for middle class taxpayers and bring relief to small businesses and non-profit organizations affected by the MTA payroll tax.
The new tax structure was part of a larger economic reform package that also included $50 million in additional relief for businesses, farms and municipalities – including those in Rockland and Orange counties – that were devastated by recent flooding from Hurricane Irene and Tropical Storm Lee. It also reduces the tax burden for manufacturers in order to incentivize job creation in the Hudson Valley.
“Middle class New Yorkers will have more money in their pockets and small businesses will no longer have to pay the job-killing MTA payroll tax,” said Senator Carlucci. “I came to Albany to help move this state forward and break the political gridlock that has plagued Albany for decades. I am proud to have been a part of this bi-partisan effort and to have had the opportunity to work with Governor Cuomo, my Senate colleagues, and all of our partners in state government to pass this bold and progressive reform legislation.”
The tax plan includes a tax break for 4.4 million middle class taxpayers. A breakdown is below:
Previous Tax Rate
New Tax Rate
$40,000 to $150,000
$150,000 to $300,000
$300,000 to $2 million
7.85% - 8.97%
Over $2 million
Among other elements, the plan includes:
Reducing the MTA Payroll Tax
The MTA payroll tax will be eliminated or reduced for over 700,000 small businesses and non-profit organizations. In addition, private elementary and secondary schools, as well as parochial schools, will be exempt from the tax.
Creation of a Flood Recovery Grant Program
This $50 million grant program will continue recovery efforts in regions of the State impacted by Hurricane Irene and Tropical Storm Lee.
The program includes the following support for communities recovering from the storms:
- $21 million for small businesses, farms, multiple-dwellings and non-profit organizations that sustained direct physical flood-related damage costs not covered by other federal, State or local recovery programs. Grants of up to $20,000 will be available to businesses that are on the Small Business Administration's list of organizations that have sustained damage.
- $9 million for county flood mitigation or flood control projects. The grants for each county would range from $300,000 to $500,000; however, counties could jointly apply. Eligible counties must be included in Federal disaster declarations
- An additional $20 million included in federal disaster declarations distributed on an as needed basis
- Permitting local government to let taxpayers impacted by the storms to pay their property taxes in installments
Enacting a Jobs Retention Credit for Businesses Impacted by a Natural Disaster
The credit would be available to firms with at least 100 employees that have retained or expanded their workers' roles during this time. The credit would equal 6.85 percent of the wages of retained jobs and is targeted towards employers in financial services, manufacturing, software development, new media, scientific development, agriculture and other sectors.
Creating New York's first-ever infrastructure fund to inject more than $1 billion in job creating investment.
The accelerated state funding will leverage $10 billion from $1 billion in direct capital investment to create thousands of jobs by rebuilding roads and bridges; parks, dams and flood control projects; upgrading water systems and educational facilities; and investing in energy efficient improvements to commercial and residential buildings. The plan will focus on projects that support regional Economic Development Plans in the transportation, energy, environment and public facilities sectors. The accelerated infrastructure fund investment is within the state's debt ceiling.