December 30, 2004
Council Urges Governor to propose single-sales factor in '05 budget
The Business Council has urged Governor Pataki to push for adoption of a single-sales factor tax code that will result in tens of thousands of additional jobs for New Yorkers.
In January of 2004, the Governor challenged the legislature to adopt a tax code that provides a reason to create jobs in New York, wrote Business Council President Daniel B. Walsh in a December 23 letter to the Governor.
“The context was your proposal to create single-sales factor taxation as part of our corporate tax code,” the letter said.
The arguments behind the single-sales factor are correct- our current corporate tax discourages job creation by giving employers a tax increase when adding jobs.
“We believe tax reform that would reward rather than punish job creation remains critically important, and urge you to include a more complete version of your 2004 proposal in the coming year’s budget.”
Single-sales factor would help the state’s struggling manufacturing sector, as well as relatively new industries, make investments in New York, bringing in more jobs.
“Our tax code has long been structured in favor of manufacturing- in terms of the investment tax credit, for instance- because those jobs bring in wealth from around the country and around the world,” Walsh wrote. “For purposes of single-sales factor taxation, manufacturing should be defined broadly to include key sectors that create jobs here by selling products and services in the national and global marketplace- including newspaper and periodical publishing, software development, and nanotechnology.”
The Council also urged the governor to include in the single-sales factor proposal other sectors of the state’s economy, including the financial service and broadcasting industries.
“With the adoption of single-sales factor taxation for key industries, our tax code will be positioned to boost different regions with differing industrial mixes, encouraging new capital investment and new jobs all across the Empire State.”
Analysis by The Public Policy Institute, The Business Council’s research affiliate, has shown that single-sales factor taxation will result in tens of thousands of additional jobs for New Yorkers, Walsh wrote.
“Those jobs will create income-and other tax revenues that will more than make up for any costs the state might otherwise expect as a result of a single sales factor tax reform.”