The good news is that Gov. Cuomo is committed to delivering $2 billion in tax relief to be phased in over the next three years.
The bad news is that key proposals from his tax-cutting commission give New York City the short end of the stick.
This must not stand.
Cuomo is positioned to return money to taxpayers because he held spending growth to 2% or less in each of the last three years, and because he wisely says he is determined to follow suit again, even as state revenue has grown.
The governor is right that “surplus” cash must go back to the public. The question is how to distribute the bounty, including in the five boroughs.
Co-chaired by Republican former Gov. George Pataki and Democratic former Controller Carl McCall, the tax commission focused on property and business taxes, as Cuomo had directed.
Its recommendations are skewed heavily toward the suburbs and upstate, urging smartly structured relief for those areas that largely bypasses the city.
Regarding suburban and upstate property taxes, the panel called for a two-year “freeze” for homeowners in jurisdictions that live under a 2% cap in tax growth and find ways to cost-share with other jurisdictions.
Offering the breaks to local governments that economize is a smart way to encourage spending restraint. It’s too bad Cuomo couldn’t find a way to push New York City into limiting spending hikes to 2% each year, just the way he does in the state budget.
The panel further recommended a tax credit for homeowners whose property taxes exceed a certain percentage of their income. While this would apply in the five boroughs, it would do nothing for the half of the city’s dwellers who rent.
Recognizing the unfairness, Cuomo promised an additional tax credit for renters. That’s a start.
Whatever specifics he puts forward — and whatever the Legislature approves — they must assure that the overburdened taxpayers of the Bronx, Brooklyn, Manhattan, Queens and Staten Island share breaks fully proportionate to those enjoyed elsewhere.
On the business side, the commission recommended simplifying the corporate tax, lowering the rate from 7.1% to 6.5% and accelerating the phase-out of a surcharge on energy bills — all of which would stimulate investment and job-creation. Good.
But for upstate manufacturers — and only upstate manufacturers — the panel would knock the corporate rate down to 2.5%. Again, with due respect to the rough condition of the northern economy, there’s no good reason why manufacturers struggling in the city’s high-cost environment shouldn’t get an equal shake on taxes.
Cuomo is absolutely right to demand relief in a state with the nation’s heaviest state-and-local tax burden. But he must remember that 42% of his beleaguered taxpayers live in New York City.
