Governor Andrew Cuomo has reached a deal with New York’s lawmakers on the $212 billion budget that was unveiled recently.
According to local media reports, the budget package is set to make the state’s highest earners pay greater taxes while legalizing online betting for sports competitions amongst some other interesting findings, mentioned close sources. Moreover, the decision comes as the state plans on helping to bring back the economy after suffering major losses due to the recent COVID-19 pandemic.
Other provisions in the mighty package include the initiative towards increasing the personal income tax rate from 8.82% to 9.65% for those making around $1 million in a year, as well as those couples who make more than $2 million in a year too.
Meanwhile, critics weren’t too happy with the move. They believe that the mega tax hikes will not only cost the state tax revenue as many high earners would flee towards those areas where there are lower rates for taxes.
These tax increases will reportedly generate a mega $4 billion in additional revenue for every year, till 2027, confirmed sources.
The move comes as New York gears up to significantly enhance its spending as reported in the New York Times. On the other hand, the 11th-hour budget would also manage to make two new brackets when it comes to income, taxing those making more than $5 million at 10.3% while those making $25 million around 10.9%, outlets mentioned.
This makes rich New Yorkers be taxed higher than any other state, including California, after the combination of both local as well as state personal income tax rates, mentioned the New York Times.
New York also plans on enhancing the tax rates for corporate franchises including those businesses that bring in more than $5 million when it comes to their annual income. The rate will jump from 6.5% to 7.25% till the year 2024. This will balance all the books that the government will use for their increased spending.