How to Climb out of the Financial Rut in NY State

On Feb. 5th R&R heard a presentation by Rebecca Saletan and Nick Lyndon on “The Invest in our New York Act”. It is a package of 6 bills for the State of NY. Together they are proposed to raise more than $50 billion/year in sorely needed revenue:

TAXING HIGH INCOMES

  1. Progressive Income Tax S2622: Creates a tax system where New Yorkers pay a higher rate if they earn significantly more money.RAISES $12-18 BILLION

Right now, individuals with incomes between $21,400 and $1,077,550 are all taxed at roughly the same rate of 6.5%. Higher earners should pay a higher rate. This bill would raise the tax rates on the top 5% of income-earners ($300,000 and above).

Sponsored by Senator Robert Jackson and Assemblymember Demond Meek

2. Capital Gains Tax A3152:

Taxes income from investments like stocks same as wages.RAISES $7 BILLION

Rich people make much of their income from investments like stocks, not from their jobs. The federal government taxes investment income at a much lower rate than wages. New York can fix this by adding a tax to investment income that’s equal to the tax break the rich are getting from the federal government.

Sponsored by Senator Gustavo Rivera and Assemblymember Ron Kim

TAXING WEALTH

3. Heirs’ Tax S3462 :

A progressive tax on large sums of inherited wealth.RAISES $8 BILLION

Many rich people also make their money from inheriting enormous sums. They can make up to $5 million in a year through inheritance and pay no tax on it. Inheritances of less than $250,000, family homes up to $2 million, money from pensions or retirement funds, and family farms will not be affected. 

 Sponsored by Senator Jabari Brisport and Assemblymember Michaelle Solages

4. Billionaires’ Tax:

An additional tax on billionaires, and constitutional amendment to allow a wealth tax. RAISES $23 BILLION IN THE FIRST YEAR, $1.3 BILLION PER YEAR THEREAFTER

New York already has a wealth tax: it’s called a property tax. Homeowners pay it every year. But if you own a massive stock portfolio, it is not taxed. This tax would treat billionaires’ gains in wealth as income, and these increases would be taxed at income tax rates. Additionally, a constitutional amendment would allow the state to tax large sums of intangible wealth—i.e., stocks, bonds and company ownership— in the future.

Sponsored by Senator Jessica Ramos and Assemblymember Carmen De La Rosa

TAXING CORPORATIONS AND THE FINANCIAL SECTOR:

5. Wall Street Tax : A small tax on Wall St. financial transactions.RAISES $12-29 BILLION

Unlike other major financial centers like London and Hong Kong, New York doesn’t place any tax on financial transactions. The financial industry is the state’s largest industry: it makes up 30% of our economy. This bill places small taxes on trades of stocks, bonds and derivatives; a similar tax on stocks existed in NY until 1981.

Sponsored by Senator Julia Salazar and Assemblymember Yuh-line Niou

6. Corporate Tax  S2833: A bill to repeal the Trump tax cuts, by restoring taxes on the profit a corporation makes each year. RAISES $9 BILLION

In 2017, Trump’s tax cuts reduced the federal corporate profit tax rate from 35% to 21%, and cut taxes on real estate businesses by 20%. New York can end these tax breaks in our state so that businesses pay the same tax as they did three years ago. 

Sponsored by Senator Brad Hoylman and Assemblymember Anna Kelles

There is a detailed discussion with over 50 slides which is well worth reading (and beyond this summary):

https://docs.google.com/presentation/d/1MX3-gtlQzBi0nRxNmfTKcziy7YjfB4Y6jnT5Gj-8jVo/edit?usp=sharing

Other useful links:

Overview:

•           Website: http://investinourny.org

•           Summary of IONY campaign: https://investinourny.org/media/pages/home/7cab0e70bc-1610298367/ionyactsummary_2021launch_1.2.pdf

•           Full report of IONY campaign (38 pp): https://www.investinourny.org/media/pages/home/f437403786-1610116749/ionyfullreport_1.2_2021launch.pdf

•           IONY letter-writing signup: https://docs.google.com/forms/d/e/1FAIpQLSdXINT1cBHq3bnltkSB5CcCazmbJTJF7KdVe88XimczIJ555g/viewform?gxids=7628

•           Letter-writing instrux and model: https://docs.google.com/document/d/1IGJCEf7we9tjmzMKfFVzM6lkDzxu20go2cW3R9RVRm4/edit

•           Bills and sponsors (bill numbers being added as they’re assigned): https://docs.google.com/document/d/171fdRvmXfMSWJVAFOsvnR1588-7wW9RM59btli2cqmc/edit

About D. Posnett MD

Emeritus Prof. of Medicine, Weill Cornell Medical College
This entry was posted in budget, Coronavirus, economics, economy, Fair Labor Standards, Pay Equality, Poverty, Tax Reform, Uncategorized and tagged , , , , , , . Bookmark the permalink.

2 Responses to How to Climb out of the Financial Rut in NY State

  1. Joanne Young Doesschate says:

    This article in Newsday today shows how vital passing the IONY Act is. 50 LI School Districts would lose state aid under Cuomo’s proposal. From Sag Harbor to Smithtown in NY1. Longwood, Connetquot, Center Moriches, Smithtown, and Patchogue Medford will all get a minimum one million $ cut. While some schools will get small increases, given what Covid has cost school districts, no schools can afford cuts.
    https://www.newsday.com/long-island/education/state-school-aid-1.50144075

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