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June 15, 2004

Senate launches push for tax cuts that would eventually value $1 billion

The Republican Senate Majority has launched a new push for a package of tax cuts and tax credits it says would be valued at $1 billion when fully effective.

"Some critics might say it's late in the session to be talking about tax cuts, but there is never a bad time to cut taxes," Senate Majority Leader Joseph Bruno said at a June 15 news conference touting the plan.

"With our package we're helping small high tech and biotech firms stay and grow in New York and create new jobs. We're helping small businesses afford the cost of providing health insurance to their employees. We're helping families that have to take care of elderly loved ones in their home. As we move forward on a new budget, we will work to see that it includes these tax cut provisions."

The Senate proposal would provide a small-business health-insurance tax credit, a new R&D tax credit for companies in high technology or the life sciences, and new tax credits for the film and television industry in New York City. The investment would total $56 million in fiscal year 2004-05, but the value of the programs would be about $1 billion when fully phased in, the Senate release said.

The Senate estimated that there are about 400 firms in New York eligible for the credit, and that it could save these businesses $60 million a year.

"We're pleased the Senate is considering ways to help New York businesses, and the effort to make health insurance more affordable for our smallest businesses is especially welcome," said Business Council President Daniel B. Walsh. "As the Senate pursues this worthy agenda, we hope they and their colleagues in the Assembly will also focus attention on additional measures that are absolutely necessary to cut New York's already high costs of job creation. Lawmakers absolutely must reduce our state and local tax burden, and the costs of workers' compensation, energy, and health insurance for all employers and all New Yorkers."

The Senate proposal also includes an investor program designed to encourage venture capital companies to invest in Excell-NY enterprises. The program would focus on large-scale manufacturers with a research and development focus, the Senate release said. The program would provide $200 million in investment funds and provide companies with tax savings of $20 million a year beginning in 2005.

The health-insurance tax credit is designed to encourage more small businesses to provide health insurance for their employees. The Senate plan would provide a tax credit of 50 percent of the cost of insurance premiums to companies with 50 employees or less. The new credit would be available only to businesses with 50 or fewer employees and with earned net income of $290,000 or less, which is how state tax law defines a small business.

The Senate tax plan also includes: