Assembly Speaker Carl Heastie called for a tax hike on the rich Thursday, saying New York should go beyond its current “millionaires tax.”
Heastie (D-Bronx) said New York shouldn’t just impose a higher income-tax rate for those earning $1 million or more annually but add tax brackets for even higher incomes. His proposal stands in contrast with Democrat Gov. Andrew M. Cuomo and the Republican-led Senate, assuring that the millionaires tax will be a key battle in this year’s state budget.
Heastie’s plan would create a tax bracket for those earning between $1 million and $5 million per year, an 8.82 percent tax rate, equivalent to the current millionaires tax; one for incomes between $5 million and $10 million, 9.32 percent; one for $10 million to $100 million, 9.82 percent; and one for $100 million or more, 10.32 percent.
The Democrat said the higher rates would impact 66,000 big-earning taxpayers and generate an additional $5.6 billion in revenue. Heastie called it a “progressive tax proposal” that would “address income inequality and funding for critical services.”
“By ensuring that tax rates are tailored to expect more from those who can most afford it, we can make sure our communities have better schools, New Yorkers have better access to health care and that tax burdens do not crush those who are struggling to make ends meet,” Heastie said in a statement.
Cuomo has called for a straight up renewal of the millionaires tax, keeping the top rate of 8.82 percent for those earning $1 million or more annually. Cuomo said returning the rate to 6.85 percent would mean a loss of about $2 billion in tax revenue to the state.
Senate Majority Leader John Flanagan has said he opposes renewal of the higher rate, saying taxes already are too high.
Cuomo has proposed a $162 billion state budget that would boost aid to elementary and secondary schools by 4 percent, about $1 billion; allot $2 billion for water infrastructure; provide $260 million to help nonprofit social services agencies adapt to the state’s rising minimum wage; and spend $163 million to create a pathway to free tuition at public universities for students from families earning $125,000 annually or less.
The millionaires tax, first imposed in 2009 during the Great Recession, is a key cog in the plan. Cuomo opposed the tax in 2011, his first year in office, but changed his mind and has since gotten the legislature to renew it twice. It is set to expire Dec. 31.
A budget is due by April 1, the start of New York’s fiscal year.