Senate Majority Opposes Governor's Attempts To Delay Income Tax Refunds

February 23, 2010

If New Yorkers have to pay their taxes on time, the state should provide its refunds on time, Senate Majority Democrats told Governor Paterson today. Passing a resolution with broad bi-partisan support, the Senate formally opposed the Governor’s scheme to delay more than $500 million in refunds to individuals and $200 in refunds to businesses.
Under the Governor’s plan, the state’s current cap on income-tax refunds paid out before March 31st would be lowered from $1.75 billion to just $1.25 billion, resulting in a nearly two-month delay for thousands of taxpayers awaiting lawful refunds. Additionally, taxpayers will not be paid interest on their funds until June 1 while businesses would be denied any interest until the second half of March.

“This is the taxpayers’ money, not the Governors,” said Senate Majority Conference Leader John L. Sampson. “The Senate Majority is focused on comprehensive structural reforms to this year’s state budget which will control spending, create jobs, and end the decades of fiscal irresponsibility. Albany has to change the way it does business before New York goes out of business, and proposals such as this distract from the serious discussions about budget reform missing in the Governor’s proposal.”

“Delaying the payment of income tax refunds is unacceptable especially when so many New Yorkers are financially strained,” said Senate President Pro Tempore Malcolm A. Smith. “These are funds that were overpaid and it is a dangerous precedent for the Governor to propose throwing away a tax filing and return policy which has worked well for decades.  New Yorkers deserve to receive these funds without delay.”

"In this difficult and challenging economic climate, it is even more imperative for state government to issue income tax return funds in a timely way to those citizens and businesses lawfully and rightfully due these refunds. In challenging financial times, income tax refunds help state residents meet daily needs, like buying food, paying their rent and utility bills, and providing for their families, and they assist small businesses in re-investing, purchasing equipment and providing jobs,” said Senate Majority Leader Pedro Espada Jr. (D-Bronx). “Clearly, income tax refunds can play a significant role in jump-starting the ailing economy and providing a much-needed financial life-line to those New York residents and businesses most in need."

Senator Eric T. Schneiderman (D-Manhattan/Bronx) said, "Delaying tax refunds in a time of economic crisis is completely unacceptable. Hard-working New Yorkers who’ve played by the rules and are counting on these refunds to put food on the table deserve better than Albany gimmicks and games. We have an obligation to give the taxpayers their money back.”
Senator Brian X. Foley (D-Blue Point) said, “Working families on Long Island and around the state are tightening their belts and honoring their commitments. The governor must do the same. Withholding income tax returns from individuals and businesses is unfair and irresponsible. We need real fiscal reform in order to tackle the state’s financial challenges not one-time gimmicks that penalize hard working people who have played by the rules and filed their taxes.”
Senator Toby Ann Stavisky (D-Queens) said, “The Governor's proposal to delay payment of income tax refunds is nothing short of irresponsible.  New Yorkers who work hard, obey the law, and pay their taxes on time expect a timely refund of any overpayments.  Our constituents count on these refunds to pay rent, cover heating expenses, pay their children's school fees, and many other vital quality of life costs.  They should not have to wait for money which is rightfully theirs.  Businesses need the returns to upgrade equipment and infrastructure, or to provide funds so they can hire new workers.  This proposal is a short-sighted budgeting gimmick which will hurt every New Yorker, and we must do everything we can to fight it.  If the state keeps our money, it should pay interest.”
Senator Kevin Parker (D-Brooklyn) said, “Today, Governor David Paterson proposal to delay more than $700 million in income tax refunds is truly unacceptable,” “Delaying the return of these funds risks the life and livelihood of families and business across the state. Millions of New Yorkers rely upon their income tax return to meet basic needs.  Those with means have many options and opportunities; those without means now need government more than ever.  Throughout our state’s history we have met those commitments.  We cannot stop now.”

LEGISLATIVE  RESOLUTION calling upon Governor David A. Paterson to  immediately abandon his intention to delay the refunding of  individual and business  income tax overpayments and refund those tax overpayments with all deliberate speed
WHEREAS, Governor David A. Paterson announced, as recently as February 16, 2010, his intention to delay payment of approximately $500 million in personal income tax refunds owed to New York State taxpayers; and
WHEREAS, The hard economic times in which hard-working individuals and families across the State presently find themselves make it critically important for the State to remit personal income tax refunds as expeditiously as possible, in order to meet  the  dire needs of taxpayers struggling to make necessary purchases and meet their financial obligations; and
WHEREAS, Governor Paterson has also announced his intention to delay payment of approximately $200 million in business tax refunds; and
WHEREAS,  Many small and large businesses depend upon the timely receipt of their tax refunds to support the ongoing economic and market- place activity driving their local and regional economies; and
WHEREAS, The residents, businesses  and  taxpayers generally in the State have  already  shared  the sacrifices imposed upon them by recent cuts in vital programs; now, therefore, be it
, That this Legislative Body pause  in  its  deliberations  to call  upon  Governor David A. Paterson to immediately abandon his intention to delay the refunding of individual and business income tax  overpayments  and  refund  those tax overpayments with all deliberate speed; and be it further
RESOLVED, That a copy of this Resolution, suitably engrossed, be transmitted to The Honorable David A. Paterson, Governor of the State of New York.