Assemblyman Kellner Needs to Check His Facts!
Recently Assemblymember Kellner wrote an editorial column in the NY Post, calling to Let the Millionaires Tax Die, which would essentially leave our children wide open to education cuts. Billy Easton, the Executive Director of the Alliance for Quality Education responds below. TO TAKE ACTION PLEASE VISIT http://www.aqeny.org !!
Dear Assemblymember Kellner,
In your recent opinion editorial column in the New York Post entitled Let the Millionaires Tax Die you assert that the millionaire’s tax “hasn’t even raised the revenue it was supposed to — falling well short of the projected $4 billion a year.”
However, the New York State Division of Budget’s Enacted Budget Report of August 2010 reported that high-income tax provisions actually generated $3.83 billion in 2009–just shy of the initial $3.9 billion projection. The DOB is projecting even better outcomes in 2010 and 2011 – over $4.9 billion each year.1 While there is a myth in Albany that the higher rates on higher income New Yorkers did not produce the revenue expected revenue; this myth is not borne out by the facts. If you have other data to support your assertion to the contrary, I ask that you share it immediately.
Furthermore, the budget deficit is currently projected to increase another $5 billion in 2012-13. It would be irresponsible to allow the deficit to grow in this manner. Yet the elimination of the millionaires’ tax at the end of 2011, as you and Governor Andrew Cuomo have advocated, would directly result in almost exactly that–a $5 billion growth in the deficit.
You are correct that the modestly higher rates applied to the highest incomes – what some have dubbed a “millionaires’ tax” – includes more than millionaires. The increase includes individuals with taxable incomes over $200,000 and families with taxable incomes over $300,000 – the top three percent of New Yorkers. The same group of New Yorkers (those earning over $250,000 a year) just received an unexpected $8 billion windfall with the federal government’s renewal of President Bush’s tax cuts for the wealthy.
If the higher rates on the top 3% are eliminated, as you advocate, then the highest tax bracket will kick in at $40,000 a family and $20,000 for a single filer. In other words the city’s wealthiest landlords pay the same tax rates as teachers, bus drivers and firefighters Does it make sense for a family making $40,000 a year to pay the same tax rate as those making $400,000 or $4 million? If you desire additional progressivity in the tax system an option would be to add an additional tax bracket for New Yorkers earning over $1 million annually; adding just 1% to their current income tax rate would generate an additional $1.4 billion a year.
Alternately we can cut our way out of this budget hole. A $5 billion a year cut in revenue would mean a lot of additional cuts in our most important investments. Your editorial offers only $400 million in suggestions for how to replace $5 billion. One of your ideas would have retirees take $110 a month out of their Social Security by making them pay more for their Medicare. The Governor has suggested he will make major cuts to our schools as one way to finance the elimination of the millionaires’ tax. Last year the state made $1.4 billion in cuts to public schools—the largest cuts in history. Will you support another round of dramatic cuts to our schools as a consequence of phasing out the millionaires tax?
The Committee to Save New York, made up of large landlords and corporate lobbyists has featured your NY Post editorial on their web site. This Committee has raised $10 million to buy TV ads advocating cuts to school children and others in order to pay for the elimination of the millionaires’ tax. I hope your column is not an indication that you will be supporting this agenda.
1 New York State 2010-11 Enacted Budget Financial Plan, August 20, 2010. Current estimates for top-income tax rates average approximately $4.35 billion annually for the years 2009 to 2011, even after adjusting downward to account for deduction limits. The 2009-10 and 2010-11 New York State Enacted Budget reports estimate annual revenues of $100-300 million from limitations on high-income itemized deductions.