Summary provided by Reid, McNally & Savage (RM&S), December 11, 2013
On December 10, the Governor convened his New York State Tax Relief Commission, co-chaired by former Governor George Pataki and Carl McCall, to unveil a series of targeted tax relief proposals – valued at $2 billion within three years – that would provide tax relief for manufacturers and residents.
The Governor opened the presentation by stating that, while personal income tax can be onerous for New Yorkers, the Commission was asked to focus on miscellaneous and burdensome business taxes as well as property tax, particularly in Upstate New York. The Governor did mention that in 2018, however, the temporary personal income tax increase on high earners will expire.
The Commission recommends that the State provide a two-year program to freeze residential property taxes only for homeowners in jurisdictions that abide by the 2 percent real property tax cap.
In the first year, eligible homeowners would see a tax rebate equal to the amount of the increase in a homeowner's tax bill. In the second year, homeowners in jurisdictions that abide by the property tax cap would receive a rebate of their tax increase only if they reside in jurisdictions that take meaningful concrete steps toward finding permanent structural savings by sharing services with other jurisdictions or consolidating governments in their entirety.
Beyond the property tax recommendation, the Commission recommends:
- Reducing Property Tax on Manufacturers: the Commission is recommending a corporate and income tax credit equal to 20 percent of the amount of real property taxes paid by manufacturers in New York.
- Lowering Corporate Tax Rates and Simplify Structure: The Commission recommends the reform and simplification of the State's primary corporate income taxes coupled with a reduction in the corporate income tax rate to 6.5 percent, from the over 7 percent currently in force.
- Reducing Corporate Tax Rate for Upstate Manufacturers: The Commission recommends reducing the corporate tax rate for upstate manufacturers to 2.5 percent.
- Accelerating Phase Out of Utility Surcharge: The Commission recommends the accelerated phase-out of utility assessments (18-a), scheduled to be eliminated in 2018. Industrial customers will no longer pay the assessment in 2014 and all other customers will see an accelerated phase out of the surcharge.
Finally, the Commission recommends Estate Tax Reform increasing the State's threshold to $5.25 million, indexed for inflation, and lowering the tax rate to 10 percent from 16 percent.
pdf Click here (609 KB) for the full report. The Report will be transmitted to the legislature for their consideration.