Readers responding to this week’s RBJ Daily Report Snap Poll were narrowly divided on whether New York’s so-called “millionaires’ tax” should be allowed to expire this year.
Slightly more than half of respondents think the tax surtax should continue, but some of those favor even higher rates for tax filers earning $5 million or more.
When Gov. Andrew Cuomo visited Rochester a few weeks ago to promote his new budget plan, he said the focus of debate in Albany likely would be a three-year extension of the millionaires’ tax, which is slated to expire Dec. 31, dropping the personal income tax rate for wealthy New Yorkers to 6.85 percent from 8.82 percent.
“If that happened, the cost to the state would be $3.5 billion,” Cuomo said. “It would decimate the budget.”
The current tax surtax on wealthy filers was enacted in 2009 and revised in 2011. For 2016, single filers earning $1,070,350 or more pay the top rate; for married couples filing jointly, the income threshold for the top rate is $2,140,900.
Cuomo and other supporters of the millionaires’ tax say the money it generates is needed to help pay for budget priorities such as education aid and a middle-class tax cut. Opponents argue it drives wealthy residents from the state and hurts owners of small firms who report their business income on their personal income tax returns.
According to the most recent Internal Revenue Service data, New York in 2014 had 47,440 tax filers earning $1 million or more, up from 35,802 in 2010, the first full year of the economic recovery. That 32.5 percent increase compares with a 45.3 percent increase nationwide over the same period.
Meanwhile, Assembly Speaker Carl Heastie and Assemblyman Herman Farrell, chairman of the Ways and Means Committee, have proposed new brackets for those earning $5 million or more. The top rate, for filers earning more than $100 million, would be 10.32 percent. Heastie and Farrell say the new tax structure would generate $5.6 billion in additional revenue compared with the current tax law and would affect some 66,000 taxpayers.
Roughly 665 readers participated in this week’s Snap Poll, which was conducted Feb. 13 and 14.
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