March 6, 2008
BUSINESS COUNCIL PRESIDENT
AND CEO KENNETH ADAMS
STATEMENT ON ASSEMBLY TAX PROPOSAL
ALBANY—The Business Council opposes the Assembly Majority's plan to impose a personal income tax hike on upper-income New Yorkers.
Raising $1.5 billion more through tax increases would only make it easier for the state to avoid facing, and fixing, its real budget problem—excessive spending.
State taxes are not down, they are up—way up. State data show that total tax receipts are up $2.2 billion this fiscal year and will grow another $2.6 billion in 2008-09 without any change in our tax code or regulatory fees. Our budget problem is not because revenues are down, it's because state spending continues to skyrocket.
The Executive Budget would allow state spending to grow at 5 percent, far beyond our means in tough economic times. The budget growth rate should be limited to the projected rate of inflation, around 3 percent, which would largely eliminate this year's $4.4 billion budget gap. Modest reductions in agency spending on state administrative functions could close the remaining gap.
New York cannot tax its way out of its current budget problems.
More aggressive controls on spending, and more emphasis on improving the state's economy, are the real long-term fixes.