Tag: New York

SALT Cap Tussle: NY Democrats Have an Ultimatum

Mary Pat Campbell

Link: https://marypatcampbell.substack.com/p/salt-cap-tussle-ny-democrats-have

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Excerpt:

It’s not just a matter of the state/local tax levels for each state, but also what income levels are like for the state.

In any case, the pattern of which states’ taxpayers get the biggest boost from SALT deductibility might surprise you a little, such as with Utah and Georgia. But many aren’t surprising at all, such as New York and New Jersey.

But even without considering the geographical footprint, obviously high-income folks get the biggest boost from removing the SALT cap. This has been known since the TCJA back in 2017 when they imposed the cap to begin with. It’s partly why it was done.

Author(s): Mary Pat Campbell

Publication Date: 15 April 2021

Publication Site: STUMP at substack

Why some of the most liberal Democrats in Congress want to bring back a tax break for the rich

Mary Pat Campbell

Link: https://www.vox.com/policy-and-politics/2021/4/14/22375306/salt-tax-deduction-repeal

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Excerpt:

The debate over Democrats’ next move on infrastructure, which Biden has put forth as part of his American Jobs Plan, and whether and how to pay for it through taxes, is just getting started. Plenty of proposals are going to be on the table, including SALT. The White House has signaled some openness to it, but the matter is far from settled.

“If Democrats want to propose a way to eliminate SALT — which is not a revenue raiser, as you know; it would cost more money — and they want to propose a way to pay for it, and they want to put that forward, we’re happy to hear their ideas,” White House press secretary Jen Psaki said at a press briefing on April 1.

….

According to estimates from the Center on Budget and Policy Priorities, if the SALT cap — which is set to expire in 2025 — were to be repealed earlier, it would overwhelmingly benefit those at the higher end of the income scale — the ones who were hurt by the bill back in 2017. The CBPP estimates that more than half of the benefit would go to the top 1 percent, and over 80 percent would go to the top 5 percent, of earners.

Author(s): Emily Stewart

Publication Date: 14 April 2021

Publication Site: Vox

NY House Democrats demand repeal of SALT cap

Mary Pat Campbell

Link: https://thehill.com/policy/finance/548046-ny-house-democrats-demand-repeal-of-salt-cap

Excerpt:

House Democrats from New York on Tuesday escalated their push for the repeal of the cap on the state and local tax deduction, threatening to oppose future tax legislation that doesn’t fully undo the $10,000 limit.

“As members of the New York Congressional Delegation, we urge you to insist on full repeal of the limitation on the State and Local Tax (SALT) deduction passed by Congress in 2017 and signed into law by former President Trump,” the lawmakers wrote in a letter to House Speaker Nancy Pelosi (D-Calif.) and House Majority Leader Steny Hoyer (D-Md.). “This issue is so critical to our state and our constituents that we will reserve the right to oppose any tax legislation that does not include a full repeal of the SALT limitation.”

Every Democrat in New York’s House delegation signed the letter except Reps. Alexandria Ocasio-Cortez and Kathleen Rice.

Author(s): Naomi Jagoda

Publication Date: 13 April 2021

Publication Site: The Hill

New York pension fund divests $7 million from Canadian oil sands firms

Mary Pat Campbell

Link: https://www.reuters.com/article/us-new-york-pension-oil-sands/new-york-pension-fund-divests-7-million-from-canadian-oil-sands-firms-idUSKBN2BZ1UT?il=0

Excerpt:

New York’s state pension fund is restricting investment in six Canadian oil sands companies because they have not shown they are prepared for a transition to a low-carbon future, the fund’s Comptroller Thomas DiNapoli said on Monday.

The New York State Common Retirement Fund will divest more than $7 million in securities already held in the companies, and not make any further investments in them, DiNapoli said in a statement.

Canada’s oil sands hold the world’s third-largest crude reserves and have some of the highest emissions intensity per barrel, due to the carbon-intensive production process of extracting tar-like bitumen from the ground.

Author(s): Nia Williams

Publication Date: 12 April 2021

Publication Site: Reuters

New York’s wealthiest look for exits as state readies hefty tax increase

Mary Pat Campbell

Link: https://www.cnbc.com/2021/04/08/new-yorks-wealthiest-look-for-exits-as-state-readies-hefty-tax-increase-.html

Excerpt:

New York’s top business leaders are gearing up for a potential mass exodus as Gov. Andrew Cuomo and state lawmakers prepare to raise their taxes.

With the state budget set to increase the personal income tax on the wealthiest New Yorkers as well as hiking corporate taxes, some executives who fled the city for Florida temporarily due to coronavirus pandemic lockdowns are considering permanent relocation, according to business leaders briefed on the matter.

Wealthy business leaders who have historically resisted moving at least some of their resources to Florida or other less-taxed states explained to CNBC that they are now seriously reconsidering as working from home becomes the norm, allowing more flexibility.

Author(s): Brian Schwartz

Publication Date: 8 April 2021

Publication Site: CNBC

New York Taxes Go Skyscraper High

Mary Pat Campbell

Link: https://www.wsj.com/articles/new-york-taxes-go-skyscraper-high-11617834769

Excerpt:

The budget deal Gov. Andrew Cuomo cut this week with the Legislature lifts the top marginal rate on the state’s income tax to 10.9%, from today’s 8.82%. Add New York City’s top local tax of 3.88%, and the total is 14.78%. Take a knee, California (top marginal rate of 13.3%), and recognize America’s new tax king. Wall Street types already are migrating to Florida, which has an income tax of 0%.

Mr. Cuomo’s budget deal also raises the business franchise tax to 7.25%, from 6.5%. This affects many independent proprietors and will be another incentive to escape from Manhattan. Both of these tax increases are sold as temporary “surcharges,” running through 2027 for the income tax and 2023 for the corporate tax. But politicians in Albany used the same line when they passed the “millionaires tax” in 2009. Does Mr. Cuomo think two decades is temporary?

The reason for the tax increase isn’t the pandemic or a revenue shortfall. Mr. Cuomo last year pointed a gun at New York’s head and threatened to shoot unless Congress sent more money. He received the ransom he demanded, and more. The state is getting $12.6 billion in direct budget relief from President Biden’s $1.9 trillion Covid bill.

Author(s): Editorial Board

Publication Date: 7 April 2021

Publication Site: Wall Street Journal

They Came, They Saw, They Taxed

Mary Pat Campbell

Link: https://www.city-journal.org/ny-legislators-pile-on-tax-burden

Excerpt:

The New York tax burden is already punishing enough. New Yorkers pay a greater percentage of their earnings to the state than residents of any other state. The total tax burden, on top of federal taxes, amounts to 12.79 percent of income, according to a new study. Opponents of the latest tax increases claim that the state’s punishing rates are responsible for driving high earners and businesses away, and indeed the state consistently faced massive levels of net outmigration to other states even before the pandemic. That migration has included thousands of jobs in areas like financial services. Among the firms that have relocated significant jobs away from the city are Credit Suisse, Barclays, UBS, and AllianceBernstein, according to a recent Forbes article. Goldman Sachs has moved a big-money management division to Florida, and hedge fund manager Carl Icahn has decamped there as well. The Empire State’s taxes are one reason that former hedge fund manager Leon Cooperman said, “I suspect Florida will soon rival New York as a finance hub.”

Author(s): Steven Malanga

Publication Date: 6 April 2021

Publication Site: City Journal

Corporate Dems Show Progressives How To Play Hardball

Mary Pat Campbell

Link: https://www.dailyposter.com/p/corporate-dems-show-progressives

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Excerpt:

As The Daily Poster reported back in January, congressional Democrats in states like New York and New Jersey have been pushing for a repeal of the SALT deduction caps. Biden declined to include the SALT cap repeal in the American Rescue Plan. 

If the SALT cap was fully repealed, nearly all — 96 percent — of the tax benefits would flow to the top quintile of earners, and more than half of the benefits would go to the top 1 percent of earners, according to data from the Brookings Institution. Congress’s Joint Committee on Taxation found that the majority of the benefits of a SALT cap repeal would flow to households earning more than $1 million.

Author(s): David Sirota, Andrew Perez

Publication Date: 31 March 2021

Publication Site: The Daily Poster

New York business leaders push Biden, Schumer to ditch the cap on SALT deductions

Mary Pat Campbell

Link: https://www.cnbc.com/2021/03/29/new-york-business-leaders-push-biden-schumer-to-remove-cap-on-salt-deductions.html

Excerpt:

Leaders of the finance industry and other businesses in New York are pushing President Joe Biden and Senate Majority Leader Chuck Schumer to bring back the full state and local tax deduction.

Schumer, who is up for reelection in 2022, has heard from business leaders across New York on multiple calls in recent weeks. Some of these people have also held talks with advisors to Biden.

The so-called SALT deduction was capped at $10,000 by former President Donald Trump’s tax reform bill, which became law in late 2017.

Author(s): Brian Schwartz

Publication Date: 29 March 2021

Publication Site: CNBC

Cuomo admin. kept COVID tests from nursing homes as gov’s kin got them

Mary Pat Campbell

Link: https://nypost.com/2021/03/28/cuomo-admin-kept-covid-tests-from-nursing-homes-as-govs-kin-got-them/

Excerpt:

Troubled by reports of COVID-19 running roughshod through nursing homes early in the pandemic, Jack Wheeler, the manager of upstate Steuben County, requested in April 2020 that the state Department of Health provide enough tests for every resident and staff member of three facilities in his jurisdiction.

The DOH, however, only came through with enough supplies for one of the three facilities, Hornell Gardens, with the precious diagnostic tests then hard to find, Wheeler told The Post.

That lackluster response came, as The Albany Times-Union reported last week, as Gov. Andrew Cuomo allegedly pulled strings to secure tests for bigwigs connected to his administration, as well as relatives including his brother, CNN host Chris Cuomo, and their elderly mother, Matilda.

Author(s): Bernadette Hogan, Aaron Feis

Publication Date: 28 March 2021

Publication Site: NY Post

NYS Comptroller DiNapoli: Wall Street’s 2020 Bonuses Rose Amid Volatility

Mary Pat Campbell

Link: https://www.osc.state.ny.us/press/releases/2021/03/nys-comptroller-dinapoli-wall-streets-2020-bonuses-rose-amid-volatility

Excerpt:

The average bonus paid to employees in New York City’s securities industry grew by 10 percent in 2020 to $184,000, in line with the city’s most recent 9.9 percent projection, likely allowing the city to meet or exceed its income tax revenue projections in FY2021, according to annual estimates released today by New York State Comptroller Thomas P. DiNapoli.

….

As a major source of revenue, DiNapoli estimates that the securities industry accounted for 18 percent ($15.1 billion) of state tax collections in state fiscal year (SFY) 2020 and 6 percent ($3.9 billion) of city tax collections in city fiscal year (CFY) 2020.

Pretax profits in 2020 for the broker/dealer operations of New York Stock Exchange member firms (the traditional measure of securities industry profits) increased by 81 percent to $50.9 billion. It was the fifth consecutive year of growth in profits, which are up 256 percent since 2015. Profitability in 2020 was the second highest on record, trailing $61.4 billion recorded in 2009.

Author(s): Thomas DiNapoli

Publication Date: 26 March 2021

Publication Site: Office of New York State Comptroller

250 Top Business Leaders Just Warned Cuomo: NY’s Tax Hike Proposals Will Have One Huge Consequence

Mary Pat Campbell

Link: https://fee.org/articles/250-top-business-leaders-just-warned-cuomo-ny-s-tax-hike-proposals-will-have-one-huge-consequence/

Excerpt:

Thanks to the recently-passed $1.9 trillion spending package, the state of New York is set to receive a whopping $23.5 billion in federal bailout money. This is more than enough to make up for any revenue gaps incurred over the last year. But progressive lawmakers are nonetheless considering a slew of new business and personal taxes—prompting 250 top business leaders to pen an open letter this week warning that these punitive tax hikes could have drastic ramifications.

“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,” wrote the leaders, whose ranks include the CEOs of JP Morgan Chase, Blackrock, and Goldman Sachs. “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.”

Author(s): Brad Polumbo

Publication Date: 24 March 2021

Publication Site: Foundation for Economic Education