Future of Millionaires' Tax at stake in Senate races
If the state Senate is controlled by Democrats after the election, taxing and spending policies could see some differences. Many Democrats favor extending an income tax surcharge on millionaires when it expires next spring.
New York currently has a temporary income tax surcharge on the wealthy. The additional taxes affect those making more than $300,000 a year, with the rates growing higher for incomes over $1 million, and the highest rate for $5 million or more.
The tax was first imposed during a budget crisis in 2009. Gov. Andrew Cuomo, after initial hesitation, has agreed with the Legislature to extend the surcharge two more times.
Many more Democrats than Republicans back the tax on the rich, and Democrats have the best chance in years in controlling the Senate after the Nov. 8 elections.
Ken Giardin with the Empire Center, a fiscal watchdog group, said the tax should not be renewed.
“There’s a big danger in becoming too dependent on these sorts of income tax revenues,” Giardin said, “because of their volatility.”
He said the income tax, which many businesses also pay, is susceptible to economic slowdowns and declines on Wall Street. The state’s income tax collections are already lower than originally projected for this year.
Jessica Wisneski with the progressive group Citizen Action said keeping the tax is one way of offsetting income inequality.
“I hope to see them extended so the richest among us pay their fair share,” Wisneski said, “and relieve the burden on local taxpayers.”
Giardin’s group is nonpartisan. But he said it may not matter which party ultimately rules the Senate when it comes to the millionaires’ tax. He points out that it was the GOP-led Senate that went along with extending the tax twice.
“I don’t think you can say that one party is more likely than another to raise taxes here,” he said.
Cuomo, who has been attending rallies to promote Democrats for the Senate, is also warning them to be fiscally conservative. Cuomo’s been a supporter of the state’s property tax cap, and has held the growth of state spending down to 2 percent per year.
“We’ve shown you can be fiscally responsible and you can be socially progressive,” Cuomo said at a rally on Long Island on Oct. 24.
But the governor has not said whether he thinks the millionaires’ tax should be extended, saying he prefers to deal with the issue next year.