Here's more State of the State news ....
In his State of the State address, New York Governor George Pataki announced plans for a whole plethora of tax cuts:
- Eliminate the "marriage penalty"
- Eliminate the estate tax
- Provide a $500 heating fuel tax credit for elderly residents
- Reduce the top personal income tax rate from 6.85% to 6.75%
- Increase the income threshold against the top personal income tax rate for married filers
- Eliminate the Alternative Minimum Tax for businesses
- Reduce the top business net income tax rate from 7.5% to 6.75%
- Allow businesses to immediately expense the costs of capital investments (rather than over a multi-year period)
- Create a two-week sales tax exemption for clothing purchases under $250
- Increase property tax exemption amounts for seniors
- Create school tax rebate program
The Nelson A. Rockefeller Institute of Government reports that Pataki's tax cuts would reduce state revenues by nearly $3.5 billion when fully implemented. Additionally, the Rockefeller Institute reports that the Governor proposes to offset the first budget year's cuts (New York doesn't require out-year projections to be balanced) with reductions in state spending on tuition assistant, state support for state and New York City universities, changes in welfare, changes to state support for mental hygiene and capping Medicaid costs. In essence, these tax cuts "place more money in the pockets" of New Yorkers, unless they're a state college student or parents of a college student, you're a family that requires state assistant for life's essentials or you're in need of medical support. And these cuts to services are only for the first year of the tax cuts - imagine the cuts necessary to fully offset the full $3.5 billion. Furthermore, Pataki didn't provide an answer to the court case that requires the state to provide nearly an additional $9 billion annually towards public education.