Senate Democrats Prevent Passage of GOP Amendment to Stop State Budget's Assault on Middle-Class Taxpayers

Dean G. Skelos

April 03, 2009

Typical family will pay $2,400 more in taxes under Democrat-only Budget

Senate Democrats today opposed a Republican-sponsored amendment that would have eliminated dozens of new taxes and fees included in the State budget that will force an average middle class family to pay more than $2,350 in additional taxes this year.

Despite the fact that New Yorkers are dealing with the worst economic crisis since the Great Depression and tightening their belts to make ends meet, the 2009-10 Democrat-negotiated State Budget increases taxes, fees and other revenue actions by more than $8 billion, Republicans noted.

“At a time when we should be doing everything possible to help struggling New Yorkers, Albany has made it more difficult for them to pay their taxes and to make ends meet. The budget that Democrats are enacting is the worst possible budget at the worst possible time,” Senate Republican Leader Dean G. Skelos said.

A family of four earning $80,000 a year and residing outside of New York City will pay approximately $2,400 more in taxes under the Democrat-only Budget. As a result of increased health and transportation costs, along with recent MTA fare and toll actions, the impact in New York City will be $2,650 per family.

Although Senate Republicans were successful in getting Governor Paterson to drop $1.2 billion in nuisance taxes he proposed as part of his Executive Budget, the final Budget still includes approximately $4 billion in taxes and fees added by Senate and Assembly Democrats. In addition, Democrat leaders crafted a plan in secret to raise income taxes by more than $4 billion, the largest tax increase in State history.

“The Governor answered our call and cut some of his proposed tax increases, but he did not go nearly far enough,” said Senator John A. DeFrancisco (R-I-C, Syracuse), Ranking Member of the Senate Finance Committee. “The State Budget still includes many tax hikes that directly target middle-class families and force them to pay more for things like hunting and fishing licenses, auto rentals, cigars and beer. Our amendment eliminates these ‘little taxes’ that add up to a whole lot and hurt our already struggling taxpayers.”

The Democrat-only Budget includes the following tax and fee increases:

* Personal Income Tax (PIT) increase - $4.1 billion
* Eliminate Middle Class STAR Rebates - $1.6 billion
* Governor’s Proposed Utility Tax Increase - $600 million
* Tax on Family and Individual Health Insurance Policies (DRP) - $240 million
* State and City University Tuition Tax - $220 million
* Shift Healthy NY Direct Pay Stop Loss to Insurance Assessment (DRP) - $180 million
* Other Nuisance Fees including hunting and fishing licenses - $178 million
* Hospital Assessment Tax - $158 million
* Limit Itemized Deductions for High Income Taxpayers - $140 million
* Hospital Surcharge Tax - $126 million
* HMO Tax - $120 million
* Governor’s Tax Increase on businesses in Empire Zones - $90 million
* Increased Fees Drivers Registrations and License Renewals - $90 million
* Impose Fee on Non-LLC Partnerships - $50 million
* Enhanced Bottle Bill - $50 million
* Change Tax of Overcapitalized Captive Insurance Corps - $33 million
* Impose Sales Tax on Transportation-related Activities - $26 million
* Home Care Assessment Tax - $14 million
* Increase Beer/Wine Tax - $14 million
* Cigar Tax - $10 million
* Expand Sales Tax Vendor to Dot-Com’s - $9 million
* Auto Rental Tax - $8 million
* Non-resident Covered Lives Assessment Tax - $5 million
* Highway Use Tax Fee Increase - $5 million
* Tax In-state use of Out-of-State Vehicles - $4 million
* Repeal Underutilized Credits - $2 million
* Gain Tax Nonresident Partner - $10 million annually
* Presence in New York PIT tax – $5 million annually