A group of Senators is looking to protect Hudson Valley and Long Island Employers from a new proposal to increase the payroll tax to support the MTA. To generate an additional $800 million for the MTA, Gov. Kathy Hochul has proposed raising the tax rate for larger employers in the MTA region, which includes New York City and two suburban areas. In the coming weeks, she will negotiate with lawmakers about that revenue-boosting idea she included in her budget plan this month.
Lawmakers Arguing Suburbs Shouldn’t See MTA Tax
Earlier this week, a letter was sent to Senate Majority Leader Andrea Stewart-Cousins, arguing that employers outside of NYC shouldn’t have to pay the increased tax since their workers generally won’t benefit from the city’s subways, buses, and trains. “Furthermore, the vast majority of revenue from this proposal will be injected into New York City Transit,” read the letter, signed by Democrats James Skoufis and Michelle Hinchey and Republican Rob Rolison of the Hudson Valley, and Democrat Monica Martinez of Long Island.
They look to eliminate the tax for hospitals and community colleges, as well as county and local governments in the MTA’s 5 Hudson valley counties, including Westchester, Rockland, Dutchess, Putnam, and Orange. Long island is also included. “Significant public funds flow to these groups and it is as anti-taxpayer as much as it is nonsensical to siphon some of those funds to an unrelated MTA tax,” the letter read. “It is long past time that we address this inequity.”
How Much the Actual Proposal Would Increase the Tax
Starting July 1, Hochul proposes raising the highest tax rate from 0.34% to 0.50% for employers with salaries over $1.75 million. 0.11% and 0.23% remain the lower rates for smaller businesses.
Taxes, even at such small percentages, are unwelcome. More than $500,000 was spent by the Rockland County government and taxpayers last year. A spokesman for SUNY Orange, a community college in Orange County, said the college paid around $116,000 in payroll taxes to the MTA.
Wrap Up
The Senate and Assembly are holding hearings on the Governors $227 billion budget proposal and each will prepare their versions in March as counter-offers to the proposal. Legislators and the Governor have until April 1st to approve a final spending plan.