Niagara Gazette

Local News

March 23, 2013

Truth on the taxes|State budget, called a tax cutter, was built on hikes

Niagara Gazette — ALBANY — New York's budget that lawmakers will begin voting into law this weekend is based on their power to stop a sunset.

Two sunsets, in fact.

Gov. Andrew Cuomo and the Legislature are stopping the scheduled end, or sunset, of a temporary income tax increase on millionaires, and delaying the end of a big utility tax on businesses.

Those tax measures are two critical ways the budget will pay for several tax cuts and tax breaks that will mostly take effect in 2014, an election year for Cuomo and lawmakers.

Starting next week, Cuomo and lawmakers will portray the budget one that cuts taxes despite continued hard fiscal times. They alternately term it the most business-friendly, most middle class-friendly and most family-friendly budget in years.

The budget came together after closed-door negotiations and was announced Wednesday night.

Albany politicians will tell constituents that most of them will get a $350 tax rebate check next year. The officials won't likely mention it will come from part of the $6 billion in income taxes millionaires will pay over three years.

Lawmakers will also say they are phasing out over three years the onerous utility tax paid by employers who already have some of the highest energy costs in the nation, but likely won't mention the tax was supposed to end this year.

"It's not a tax-cutting budget, no way," said E.J. McMahon of the fiscally conservative Manhattan Institute. "It's an election-year check in the mailbox, pure and simple."

In Albany, resurrecting taxes about to die is just part of the deal.

The extended taxes were not only needed to pay for the tax cuts for middle class families and mostly small businesses pushed hard by the Senate's Republican conference. Republicans needed the tax cuts to agree to the Assembly Democrats' top priority of an increase in the minimum wage, according to a senior administration official who spoke only on the condition of anonymity because closed-door budget strategy isn't supposed to reach the public.

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