Gov. Andrew M. Cuomo and legislative leaders on Tuesday announced that they had reached an agreement to raise taxes on New York state’s wealthiest residents as part of a deal to overhaul the state’s tax rates.
The leaders, seeking simultaneously to make the state’s income tax system more progressive and to boost tax collections during a down economy, announced their agreement as lawmakers began to arrive at the Capitol for an expected special session of the Legislature later this week.
The tentative agreement would not only raise taxes for the wealthy, but would also cut taxes for the middle class, by creating multiple new tax brackets and tax rates. The state’s current income tax rates are relatively flat, taxing any individuals who earn $20,000 or more, as well as couples who earn $40,000 or more and file joint tax returns, at the same 6.85 percent rate.
For the last three years, individuals who earned more than $200,000 a year, and couples who earned more than $300,000, have also been subjected to a tax surcharge called a “millionaires’ tax.”
Changing the tax rates and brackets would allow the state to replace some, but not all, of the revenue to be lost when the so-called millionaires’ tax expires on Dec. 31.”