ISSUE IN BRIEF: Key Budget Issues
Business Council Budget Priorities - The Business Council will be applying three key measurements when the 2004-05 budget is adopted:
- Is the budget done on-time?
- Does the budget keep state-funded spending to the rate of inflation, or less?
- Is the budget balanced with no delay in the phase-out of 2003 tax increases and no other tax increases?
Much has been made of Albany being dysfunctional and needing government reform. As The Business Council has said repeatedly, it is the results that matter.
Our members have said loud and clear that they want an on-time state budget that restrains spending and avoids tax hikes. These measures will be part of our 2005 Vote for Jobs New York Index (see Many members of the legislature have asked us this year how they can improve their index from 2004. Positive results on these three budget measures will go far to ensure improvement.
The Business Council supports adoption of a 2005-2006 fiscal year State budget with no delay in the phase-out of 2003-enacted tax increases, and no other tax increases.
Provisions of 2006 FY Executive Budget Revenue Bill S.995A/A.1925A - Some provisions in the Governor's Executive Budget are tax hikes and should be rejected.
- Part F creates permanent limited liability company filing fees of $100 per member (up from $50) with a minimum total fee of $500 (up from $325) and a maximum of $25,000 (up from $10,000) for subchapter K limited liability companies and limited liability partnerships and extends the filing fees to single member limited liability companies which are disregarded entities for Federal Income Tax purposes. These increases match increases that had been imposed by the Legislature via a June 2003 veto override and which expired 12/31/4.
- Part H reimposes the State Sales & Use Tax on clothing priced under $110 on 6/1/5 (when the temporary suspension of the permanent exemption had been scheduled to expire); and repeals on 6/1/5 the ability of localities to resume their exemptions of the local Sales & Use Tax for clothing priced under $110.
- Part M disallows the 60 percent exclusion of dividends received from a Real Estate Investment Trust subsidiary in both State and NY City tax law effective 1/1/5. Part N increases the maximum amount of the Business Capital Alternative Tax on non-manufacturers from $350,000 to $1,000,000.
- Part P repeals the premiums tax exclusion for county/town cooperative insurance companies effective 1/1/5.
- Part W quintuples the Alcoholic Beverage Tax on wine from five cents per liter to twenty-eight cents per liter effective 6/1/5.
In addition, The Business Council supports phase-out of 2003-enacted tax increases and opposes adoption of other broad-based tax increases.