January 9, 2007
Senate Majority, citing Council data, unveils business assistance program
Arguing that New York must do more to help businesses create good-paying jobs, the Republican Senate Majority Tuesday proposed tax cuts designed to save businesses more than $1 billion a year when fully implemented. The Senate proposal also includes increases in state aid to businesses.
The plan includes a proposal to eliminate the corporate income and franchise tax for manufacturers, regardless of size.
"Too many of our young people are leaving our communities because they don't think they will provide them with the kind of careers they want or provide a good living for their families," Senate Majority Leader Joseph Bruno said, citing data from Benchmark New York, a new report from the Public Policy Institute.
The Senate Majority said its plan would address the above-average business tax burden, documented in the Council's Benchmark New York, by eliminating the income tax and the corporate franchise tax on the state's manufacturers, resulting in $550 million in savings.
And small businesses paying school taxes would receive a property tax rebate check, averaging $700, totaling $150 million statewide.
Business Council President Kenneth Adams hailed the proposal.
"Business owners consistently rank taxes among the major competitive problems facing New York,” said Adams. "Senator Bruno and the Senate Majority are right: We must cut business taxes this year to strengthen our economy and create a climate for new jobs.
"We look forward to working with the Senate, Governor Spitzer and the Assembly to accomplish these essential goals."
The Senate Majority also noted The Business Council's recent member survey found that 41 percent of respondents said energy costs were among their top four concerns. Benchmark noted energy costs are 58 percent above the national average.
“The Senate small business plan would address that concern by providing a $350 million refundable tax credit program that would help 386,000 eligible small businesses across New York State afford the rising cost of energy,” the Senate's release said. “Under the plan, a business with 20 or fewer employees can receive a credit of two cents per Kilowatt Hour (KwH) that would be applied directly to eligible businesses' tax liability, while businesses that do not owe taxes would receive a rebate check.”
Nearly 400,000 small businesses, employing 20 people or less, would received energy tax credits totaling up to $350 million statewide.
The plan would also:
- Reduce corporate franchise tax rates from 7.5 to 6.85
percent, saving businesses $150 million.
- Expand incentives for technology companies that do research
and development in New York to manufacture products in
- Eliminate or reduce the burden of red tape and bureaucracy
by “simplifying and reducing paperwork, eliminating
unnecessary or overly burdensome fees and permits, and
creating a one-stop shopping information center to help
someone start or expand a small business in New York.”
- Eliminate multiple tax calculations for small businesses
who must calculate both personal and corporate franchise
tax. The Senate Majority estimates this would save small
businesses $20 million.
- Expand the state's online permit and licensing
program to cover all state agencies, departments and authorities
that require permits, registrations and fees. The plan
would also allow businesses to file any ongoing fees,
registration filings or assessments as part of the businesses
“Businesses could pay all applicable state fees and costs at one time, rather than pay them at different times throughout the year,” the release said. “An electronic filing option will be granted to every such taxpayer at no additional charge.”
- Create a hotline for small businesses to ask questions
about state procedure and to provide assistance to businesses
looking to expand or open in the state.
- Provide a sales tax exemption for businesses located
in academic incubator facilities. “Companies located
in academic incubator facilities would receive a state
sales tax exemption for the purchase of equipment costing
$500 or more,” the release said. “Localities
would be able to opt into this exemption as well.”
- Eliminate the alternative minimum tax for farms and
make the investment tax credit refundable. The Senate
Majority estimates this will save $2 million for the state's
farmers. The Senate program would also expand the current
farm school tax credit to leased farmland.
- Eliminate the petroleum business tax on non-residential heating fuel, saving small businesses $7 million per year.
More information on the Senate Majority's plan is available at senatorbruno.com/press_archive_story.asp?id=15559.