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Taxes for state budget must treat rich, middle−class families fairly

Why is it acceptable to balance the state budget with a barrage of regressive user fees and sales taxes that will most affect middle−class New Yorkers and exempt the wealthiest taxpayers from paying their fair share?

Earlier this year, the state Assembly voted for a one percentage point income tax increase for those making more than $1 million and a two−point increase for those making more than $5 million. This adjustment would have raised $2.5 billion to help fill our state’s depleted coffers.

Some warn that using the progressive income tax as part of a plan to close the budget gap would make New York state less competitive, but this argument is contradicted by recent history. It was only a few years ago that New York closed its post−Sept. 11 budget gap with a temporary upper bracket income tax surcharge.

At the time, many predicted that our economy would be ruined, but between 2003 and 2007, personal incomes in New York grew faster than the national average. If differences in marginal tax rates were so important, New Jersey’s affluent would have abandoned the Garden State for our own, since the tax rate for New York’s top income bracket is lower than New Jersey’s.

Any tax increase should distribute the burden of balancing the budget fairly. We should not resort to a host of taxes focused narrowly and arbitrarily on specific groups: iPod users, health care providers, cable TV subscribers, etc. Instead, revenue should be collected in a non−discriminatory manner on the basis of the ability to pay.

We should avoid regressive measures, such as the proposed increase in the sales tax on clothing and gasoline. Taxes on these necessities are especially problematic, since it is hard for families to cut back their spending on these items without reducing their standard of living. Lower− and middle−income families devote a much larger percentage of their income to necessities. A sales tax increase on these goods will fall disproportionately on working New Yorkers.

The real question is not whether the wealthy people can afford to continue living in New York, but whether working− and middle−class families can. In the midst of an economic downturn where people are losing their jobs and homes and the government is forced to make painful cuts to vital services, the last thing we should do is ask more from those who can least afford it.

Rory Lancman

State Assemblyman

Fresh Meadows

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