Monday, March 16, 2009

NY Senate Considers Some Form Of Fair Share Tax Reform

Could it be that a massive union demonstration around City Hall two weeks ago paid off? The protesters were looking for the state government to have the wealthy to pay their fair share of NY's massive budget deficit. Majority Leader Smith on the other hand, wanted to focus on spending cuts alone. Yet now after considerable pressure, he looks like he's ready to budge at least somewhat.

From The NY Times:

ALBANY — Democratic leaders in the State Senate will seek income tax increases on at least some affluent New Yorkers and a sales tax increase of a quarter of 1 percent to help balance the state budget, a Senate official with knowledge of the plans said in an interview over the weekend.
Now that's good news, but how serious are they about it?

“The Senate is signaling that it needs to balance the budget in a balanced way, meaning smart cuts and fair taxes,” Mr. Cantor said.

The Senate official also said that the Democratic majority, led by Malcolm A. Smith, would resist some other key parts of Mr. Paterson’s executive budget, including a proposal to raise the state tax on income earned by hospitals, known as the gross receipts tax, and a plan to merge the New York State Foundation for Science, Technology and Innovation into the Empire State Development Corporation, the state’s main economic development agency.

The Senate’s forthcoming proposal will serve as a framework for negotiations among Mr. Paterson, Mr. Silver and Mr. Smith.
And that is the key, the framework that is set when Paterson, Smith and Silver come to the that room. If Smith and Silver are already willing and able to raise taxes on the wealthy, it'll be extremely difficult for Paterson, as unpopular as he is already, to resist the groundswell for this effort.