A Taxing Solution Can End Our Budget
Crisis
By Bonnie Brower
Bonnie Brower is executive director of City Project, a
budget watchdog group in
New Yorkers have had time to react with shock and awe at
the litany of first-round and contingency cuts to vital public services and the
loss of thousands of jobs contained in Mayor Michael Bloomberg's worse and worst
versions of the city's budget.
From firehouses to zoos, from health clinics to foster
care, these are just some of the life-altering service losses, along with almost
5,000 job cuts, the mayor intends to make under his "better" budget
plan. Other than "suicide by budget," there are no adequate words for
the total devastation to the city and its residents that would result from the
mayor's
Contingency budget, which contains an additional $1
billion in unspeakably bloody cuts.
Unfortunately, the mayor's "better budget,"
with its $600 million in cuts, remains heavily dependent on
than it gets
back in aid, the state treats the city as a distant family relation.
So isn't there a better way to close the city's
$3.8-billion budget hole without depending on the kindness of
The answer, put forth by a new and growing citywide
coalition of community and civic organizations, faith-based institutions and
unions (with the awkward name of the Budget for a Livable NYC Coalition), is a
resounding "yes!"
If enacted, the coalition's package would generate $3.5
billion in
The majority of the proposals focus on making moderate
increases to city taxes. First, it's where the money is – right here in the
pockets of wealthy city residents and profitable city businesses, who are best
able to contribute their fair share to the city's recovery. Second, as city
revenues, the new funds will be better protected against theft by the state.
Third,
Below are several of the Coalitions revenue
recommendations:
1.The city should enact a 1-percentage point personal
income tax increase for city residents with adjusted incomes of over $250,000.
This would raise $595 million from those who can best afford it.
2. We must revise local business taxes, to make the
city's business community shoulder a fairer portion of our fiscal burden. The
city's three business taxes, all enacted in 1966, have undergone only minor
revisions since then. They are sorely outmoded and inequitable, as witnessed by
the fact that together they contribute only about 12 percent of city revenues, a
share that has remained essentially flat over the past 25 years, during boom and
bust times.
The coalition's three business-tax reform proposals
collectively would generate $1.19 billion for the city, and ensure that the most
profitable businesses contribute a greater share of revenues.
The most lucrative and necessary change would be to make
a certain class of businesses, including the wealthiest and most powerful in the
city, such as Bloomberg LP, large law firms, and major financial services
companies, pay the same tax rate as all city corporations. That would generate
$880 million a year on an ongoing basis.
Another example is the ridiculously low $300 minimum
general corporate tax, which is paid by over half the city's 240,000 plus
corporations, would be increased to $1,000, By comparison, a family of four
struggling to survive in New York City on $30,000 now pays the city nearly twice
the current minimum corporate tax in personal income taxes
3. The package also contains a simple 1 percent commuter
tax, which would generate $950 million in revenue.
If passed by Albany (which, unfortunately, alone has the
power to enact them), these measures would broaden the city's tax base, increase
long-term, revenues to maintain vital city services and spread the tax burdens
to those best able to shoulder them. Not a bad way to turn a huge fiscal crisis
around and create a better funded, more livable and compassionate city.
This article originally appeared in Newsday. Visit Newsday online at http://www.newsday.com