A long-awaited tax proposal from Democrats in the New York state Assembly would increase taxes on millionaires while giving tax relief to middle-class and low-income workers, a shift they said would raise $1.2 billion in new revenue while making the state income tax more equitable.
The Assembly also on Tuesday passed legislation to allow workers to take up to 12 weeks of paid time off to care for a new child or a sick loved one. The measure would be funded by a weekly employee payroll deduction that would start at 45 cents. The benefit would be capped at $633.
The plan, which Speaker Carl Heastie unveiled Tuesday, will run into significant opposition in the Republican-led Senate but will give Democratic lawmakers leverage as they negotiate the state budget over the next few months.
Under the proposal, the state’s current top income tax rate of 8.82 percent would be applied to anyone making between $1 million and $5 million a year. Two new, higher rates would be created for higher brackets: 9.32 percent for those making between $5 million and $10 million and 9.82 percent on more than $10 million.
The hikes would raise an estimated $1.7 billion. About 56,000 taxpayers would pay more, with the average increase projected to be $33,000. Heastie noted that some 10,000 of those people are non-residents.
“It’s a fair way to ask people to pay their fair share,” said Heastie, a Bronx Democrat. “Someone making $5 million or $10 million a year, that’s a small sacrifice.”
Senate Leader John Flanagan vowed to oppose the proposal.
“Whether it’s income taxes, property taxes, business taxes, user fees, or tolls, we don’t support raising taxes or asking hardworking New Yorkers to dig deeper into their pockets to pay more,” Flanagan said Tuesday.
The proposal would also reduce tax rates for those earning between $40,000 and $150,000 from 6.45 percent to 6.25 percent. And about 1.6 million low-income workers would see an increase in the earned-income tax credit, with the average recipient receiving nearly $110 more.