O’Mara, Senate GOP colleagues unveil broad tax cut plan focused on middle class taxpayers, seniors, farmers and small businesses

Albany, N.Y., March 10—State Senator Tom O’Mara today joined his colleagues in the Senate Republican Majority to stake out one of their top priorities for the final 2016-17 New York State budget: a broad-based tax cut plan aimed at middle class taxpayers, senior citizens, small businesses and farmers.

“New York is still recognized as one of the highest-taxed states in America.  It remains an unfair and unreasonable burden on individual middle class taxpayers, families, employers and workers,” said O’Mara. “We have to stay focused on the key priorities in New York State, and that means tax cuts.”

O’Mara said that the broad-based, $3.5-billion Senate Majority tax cut plan will be included in the Senate’s 2016-17 budget resolution, expected to be acted on next week, which spells out the Senate’s budget priorities for this year and sets the stage for final budget negotiations with Governor Cuomo and the state Assembly.

Highlights of the Senate Republican Majority tax cut plan include:

> a new “Middle Class Income Tax Relief Program” that will enact a 25-percent rate reduction for middle class taxpayers to bring middle class tax rates to their lowest level in 70 years.  Starting in 2018, a total of 5 million eligible taxpayers – including more than 770,000 small businesses who file under the Personal Income Tax – would begin seeing savings that, when fully implemented in 2025, would result in middle class New Yorkers paying a 25-percent lower tax rate equaling savings of $3.5 billion in taxes each year;

> new income tax relief to produce tax savings for New York’s senior citizens and to try to help stop the exodus of retirees from New York.  The proposed tax cut would provide the first increase to the exempt amount of private pensions and retirement income since 1981, saving hundreds of thousands of seniors approximately $275 million annually when fully phased in.  For 35 years, retirees have been able to claim the first $20,000 of pension or retirement income as exempt income. The Senate Majority’s proposal increases that exempt amount to $27,000 in 2017, $34,000 in 2018, and $40,000 in 2019. This would provide tax relief to more than 377,000 seniors;

> new tax cuts for family farms and small businesses. The 2014-15 state budget included a Senate-sponsored Personal Income Tax exemption for small businesses and small farms equal to five percent of net income in 2016 and beyond.  To qualify, the business must be a sole proprietor or farm (regardless of how the business is structured, sole proprietor, LLC, etc.), have less than $250,000 in net business income and employ at least one employee.

This year’s Senate proposal would eliminate the employee qualification and raise the income eligibility threshold from $250,000 to $500,000 in small business and farm income.  It will also increase the PIT exemption from 5 percent to 20 percent for farm income and from 5 percent to 15 percent for net business income of small businesses; 

> the complete elimination, this year, of the higher 18-A utility surcharge first imposed on New Yorkers in 2009, a state-imposed cost that has hit farmers, manufacturers and senior citizens facing high energy expenses especially hard; and

> further reforming the state estate tax  to allow estates that include farm operations or include small business property, where the value of the farm operations or small business are a majority of the estate, to have an exclusion amount equal to the federal exclusion amount starting April 1, 2016 (currently $5.45 million for 2016) .

Read more HERE.