Carl Heastie, Speaker of the New York Assembly. Photo: Karen DeWitt
December 22, 2021 – Congress, in the relief package approved last Monday, did not include a financial bailout for the states affected by the pandemic, leaving New York with a $ 1 billion budget deficit for the new year. The leader of the State Assembly says now is the time to push through new taxes on the richest and start making up for the loss.
According to Gov. Andrew Cuomo’s budget office, the state deficit is at least $ 8 billion, though the governor says it could be closer to $ 15 billion.
Assembly Speaker Carl Heastie and the Democrats he runs in this House have been pushing for months to enact new taxes on wealthier New Yorkers to help make up for the deficit. Supporters argue that states of more than 100 billionaires have seen their wealth increase during the pandemic.
“The Assembly … supports revenue collection before the end of the year,” Heastie said.
Heastie would like to set new higher income tax brackets before the end of the year so the state can start closing the gap now. He says he is concerned that if higher taxes are agreed upon in the state budget, which will take effect on April 1, they could be made retroactive in early 2021. Heastie says the state constitution requires that the tax notification is notified and wants to avoid possible legal challenges.
“It’s a legitimate question to have answered,” he said. “I think there is a constitutional issue.”
There are precedents for the collection of new taxes retroactively. During the last recession, in mid-2009, the state enacted a temporary surcharge on New York’s richest as part of its budget, which went into effect earlier this year.
Governor Cuomo says even if new taxes were passed this month, they would not provide enough money to avoid massive spending by front-line workers.
“That means we will train people we need to make the vaccines,” Cuomo said. “Dismiss the expenses of the National Guard, dismiss the police, dismiss the people, dismiss the people from the hospital, in the midst of a pandemic.”
Cuomo wants to wait before making budget decisions, until Joe Biden is sworn in as president on Jan. 20th. Cuomo believes Democrat Biden, who already works with Republicans in the U.S. Senate, may be more likely to convince Senate leader Mitch McConnell to change his mind and agree to authorize federal aid for states and local governments.
“I just hope Joe Biden comes in quickly and that sanity restores the nation,” Cuomo said.
Heastie says he doesn’t believe the federal government, even with a Democrat as president, can solve all of the state’s tax problems.
“He hopes Joe Biden, the Biden administration, can come in as the cavalry and save the day,” Heastie said.
Heastie says if Democrats don’t win two Senate seats in Georgia in the Jan. 5 election, then even the Democratic president might not be able to win a bailout package from a strengthened Senate Republican majority.
“Mitch McConnell could continue to be the same impediment he has been to giving state and local aid,” Heastie said.
Any new fiscal measure would also need the approval of the state Senate. While more than 30 Democratic state senators, who make up the majority of this House, say they support additional taxes on the state’s millionaires and billionaires, the Senate has yet to commit to approving anything before the end. of 2021.
However, it is increasingly likely that the two houses will return before December 31stc approve protections for evicted tenants and homeowners threatened with foreclosure as a result of pandemic-related job losses