Tax Committee Update

February 16, 2018

Staff Contact: Ken Pokalsky


As you know, the Executive Budget has been issued, legislative hearings held (The Business Council’s testimony is available here), and 30-day amendments released. With 17 scheduled legislative session days before the start of Fiscal 2019 on April 1, the Senate and Assembly have issued their “agreed to” timetable for finalizing the new state budget. Key dates include:

Our current focus is to get Business Council tax priorities reflected in the legislative one-house budget proposals. These include our response to Executive Budget revenue proposals, and additional Council initiatives, including tax conformity issues discussed below.



Governor Cuomo has introduced his proposal for mitigating the impact of the federal SALT deductibility cap, as part of his Executive Budget 30 day amendments released today. The bill text is available here. The Division of Budget director issued a press release on Monday outlining the proposal. Key provisions include the following:

What is your initial take on this proposal? Please click here to take a BRIEF poll on this payroll tax proposal.



While the Department of Tax and Finance’s “Preliminary Report on the Federal Tax Cut and Jobs Act” discusses several Article 9-A conformity issues, the Executive Budget includes no related amendments to the corporate franchise tax, and its “30 day amendments” included changes limited to “exempt CFC income” (see note below). With input from Tax Committee members, The Business Council has drafted a memo outlining our issues of concern and recommended amendments. Given the legislature’s budget adoption schedule outlined above, we need to finalize our conformance and amendment proposals within the next several days. We welcome any input you have on these or other issues arising from the recent federal tax reform. Please contact me at 518-694-44609 or submit questions or comments to Ken Pokalsky.



In addition to the payroll tax provisions mentioned above, the Governor proposed several other significant tax-related 30 day amendments to the Executive Budget, available on line here (scroll down to “Revenue (REV) Bill”).

These include:



We are asking for input from members that would be affected by the Executive Budget proposal to defer business tax credits. Similar to the deferral adopted in 2010, this would apply to most business-related credits under Articles 9A, 9, 22 and 33, and defer the value of such credits over $2 million per taxpayer during their 2018, 2019 and 2020 tax years. The proposal contains separate schedule for realizing deferred refundable and non-refundable credits, respectively.

The proposal exempts two of the state’s largest business credit programs from deferral, the state’s film and commercial production credit program and the Excelsior Jobs credit program.

However, most of the other major business credits would be subject to deferral. The largest credit programs, measured by the projected aggregate value of credits (NOT the projected deferral value) is presented below.

QEZE and Empire Zones 153
Brownfield Cleanup, Redevelopment and Insurance 130
Investment Tax Credit 125
RPT Credit for Manufacturers 100
Minimum Wage Reimbursement 45
Historic Property Rehabilitation 37
Low Income Housing 36

Also proposed for deferral are tax credits for targeted hiring, alternative energy, and others. The full text of the legislative proposal can be found here.


Ken Pokalsky
Vice President
The Business Council of New York State, Inc.
111 Washington Avenue
Albany, NY 12210
P.  518-694-4460  
C. 518-424-6214