More than 200 business organizations and employers in New York are mobilizing an effort to oppose increasing taxes in the state budget, arguing the move would hinder any nascent post-pandemic recovery in the state.
The letter, released by the Partnership for New York City and sent to top Democratic leaders in the state Senate and Assembly, comes as lawmakers have backed their own spending plans that would generate billions of dollars in revenue through tax increases, largely on richer New Yorkers and the financial industry.
The letter pointed to the billions of dollars in direct stimulus aid for New York as part of a larger $1.9 trillion stimulus plan approved this month by Congress, helping to replace revenue lost during the worst of the pandemic last year.
“At this moment, however, significant corporate and individual tax increases will make it far more difficult to restart the economic engine and reassemble the deep and diverse talent pool that makes New York the greatest city in the world,” the letter stated.
At the same time, the business groups warned the private sector and its workers are more mobile than ever, and increasing taxes could result in those top earners leaving the state.
“For better or worse, the pandemic has demonstrated that our workforce is more mobile than we ever imagined,” they wrote.
“Our businesses are committed to maintaining a strong presence in New York, but currently only about 10% of our colleagues are in the office and prospects for the future of a dense urban workplace are uncertain. Many members of our workforce have resettled their families in other locations, generally with far lower taxes than New York, and the proposed tax increases will make it harder to get them to return.”
New York relies on a relatively small pool of big earners to generate much of its revenue from the personal income tax.
Gov. Andrew Cuomo’s top budget advisor on Monday said in a conference call the additional revenue from federal aid as well as higher-than-expected tax receipts in recent months would make significant tax increases in the budget unnecessary.
A spokesman for the Democratic-led state Senate rejected the view, saying the spending proposal by the chamber would create long-term equity.
The budget is expected to pass by the end of the month.