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Cuomo Threatens Tax Hikes Over COVID-19 Shortfalls

Facing a huge budget shortfall due to the coronavirus crisis, New York Gov. Andrew Cuomo threatened Thursday to increase the burden on New York’s heavily taxed residents, The New York Post reports.

“This will be a hole in the financial plan so large that it will be impossible to fill,” the governor said during a conference call with reporters.

“What would we do to try to fill it? Taxes, cuts, borrowing, early retirements [of government workers]. All of the above.”

New York City is already No. 1 in the nation for the highest combined burden of state and local income taxes, with a total rate of 12.7%, that works out to an average annual amount of $2,877, according to the Tax Foundation.according to the Tax Foundation think tank.

Last month, the American Legislative Exchange Council ranked the Empire State’s economic outlook the worst in the country for the seventh year in a row.

In September Cuomo begged the wealthy New Yorkers to return to the city from their second-home retreats so they can pay taxes to help offset the state’s growing coronavirus-related revenue shortfall. The governor’s threat of a tax hike is a reversal to his previous warning that an increase would put New York at a competitive disadvantage with other states and lead to an exodus of high-income New Yorkers.

Cuomo has so far resisted liberal demands to raise taxes on the rich, however New York City Mayor Bill de Blasio has less sympathy, saying he doesn’t base policies on “the wealthy few,” and voiced support for increasing rates on the rich. Instead, Cuomo hopes that President Trump and Congress will agree on a bailout package for state and local governments, if not he would have to rely on Democrat Joe Biden to beat Trump in November and ride to the rescue.

Due to his handling of the COVID-19 crisis the governor has projected a long-term deficit of $30 billion, and to help stay afloat has withheld funding to local governments and social service providers.

The shortfall for the current fiscal year is about $8 billion, according to EJ McMahon of the Empire Center for Public Policy.