Senate Majority Leader Joseph Bruno Tuesday unveiled a major expansion of his own proposal to again reduce New York State taxes.
He also urged lawmakers to limit spending, noting that spending sprees in previous years had forced tax increases to cover the spending.
The new tax-cut plan includes many business priorities, including cuts to the state's energy taxes, ton mileage tax, alternative minimum tax (AMT) and petroleum business tax.
Business Council President Daniel B. Walsh joined Senator Bruno at a news conference on Tuesday and praised both the new tax-cut proposal and the call for spending restraint.
"These new tax cuts will make it possible for New York businesses to create and keep still more jobs in the Empire State," Walsh said.
"Senator Bruno is also right to urge spending restraint," he added. "In education and health care, New York is already a national leader in spending. The Governor is aiming at the right target: a spending increase less than the rate of inflation."
Senator Bruno's new proposal would add $300 million in new tax cuts to the $795 million tax-cut plan he announced in December. Fully enacted, his plan would eventually return $1.1 billion to taxpayers.
The full Senate tax-cut package includes the following proposals:
- AMT reduction: Senator Bruno Tuesday urged a cut from 3 to 2.5 percent in the state's AMT. By ensuring that all businesses pay a minimum corporate tax, this tax often nullifies investment tax credits and other job creation incentives intended to encourage job creation by lowering taxes. Governor Pataki urged the same cut in his budget proposal.
- Petroleum business tax: Senator Bruno Tuesday urged eliminating this tax on airline fuel and commercial heating oil. The 5.6 cents per gallon tax on jet fuel would reduce a major operating cost for airlines. The 7.6 cents per gallon tax on commercial heating oil would eliminate a state-imposed price differential between heating oil and natural gas.
- Ton mileage tax: Last year, the Legislature reduced this tax, which is imposed on all companies that ship by truck, by 25 percent. The new Senate proposal would reduce this tax by another 25 percent this year.
- Energy taxes: Senator Bruno urged reductions in the GRT on electricity and telephone services by .25 percent in 2001 and again in 2002. This would reduce the total GRT rate to 2.75 percent, saving ratepayers an estimated $225 million. He also said utilities should not have to pay several taxes that were never intended for utilities but that were brought into play by the government-mandated utility deregulation.
- Bank/insurance taxes: Lawmakers last year passed a cut in the corporate tax rate from 9 to 7.5 percent--but excluded banks and insurers. Senator Bruno in December urged extending this cut to banks and insurers.
- Earned-income tax credit: Senator Bruno urged expanding this credit for low- and moderate-income workers.
Senator Bruno said the new tax cuts would help New York recover from years when "we spent too much, and then we had to tax too much to pay for the spending."
He said the Legislature must limit its additions to the spending levels already included in Governor Pataki's budget.
Click here for Business Council statement.