The $ 1.9 trillion COVID-19 relief package approved by the US Senate eliminates New York State’s projected budget deficit – possibly negating the need for heavy tax increases or spending cuts, the office said. Senate majority leader, Chuck Schumer, on Monday.
“OK. Thanks to @SenSchumer, the NYS budget deficit for this year is … Zero, nothing, niete, zilch (NY terms),” Schumer raysangelo man Roefaro tweeted.
The American Rescue Plan provides the state government’s coffers with $ 12.6 billion in unrestricted aid, a move advocated by Schumer, the senior senator from New York. The measure passed the Senate in a 50-49 vote and is expected to pass the Democratic-led House of Representatives on Tuesday and handed over to President Biden for approval.
Asked whether the pandemic relief geyser eliminates the need to raise taxes or cut spending, Roefaro told The Post, “the statement speaks for itself.”
Roefaro continued: “The way in which NY decides its budgetary policy is an issue for the state legislature and the administration. Our job was to provide resources to help NY address and overcome Covid and its impacts, including the fiscal impact. And we did it completely and completely. “
Facing a multi-billion budget gap and a restless left flank in the state legislature calling for massive tax increases on the wealthy, Cuomo proposed raising the income taxes of the wealthiest New Yorkers to a maximum rate of 10.86%, up from 8 , 82%. New York’s affluent residents pay a combined state and local income tax rate of 14.7%, the highest rate in the country.
But a budget analyst said there is now no need for any tax hikes with the geyser of federal stimulus funding flowing from Washington to New York.
“There is no need to raise taxes,” said EJ McMahon of the Empire Center for Public Policy, who has long claimed that Cuomo was exaggerating New York’s fiscal problems.
He said the income tax on the rich proposed by Cuomo as part of his executive budget plan “is no longer needed”.
McMahon said the federal aid is so large that it is sufficient to prevent large tax increases in the next two fiscal years.
Asked about the complaint from Schumer’s office, Cuomo’s budget spokesman, Freeman Klopott, referred to the governor’s comments on Sunday when he said tax increases are still on the table despite the influx of funds to the funeral.
“It’s on the table…. It’s the difference between $ 12.5 and $ 15 [billion]. And don’t get me wrong, the $ 12.5 billion is very, very useful. But, as you know, as I said 150 times, we needed $ 15 billion in my opinion, ”said Cuomo.
“So we have a gap there, and tax increases are on the table. And they are on the table of the Assembly and the Senate, I am not speaking for them, they can speak for themselves, but yes, they are on the table, because you have damage to fix ”.
Cuomo expressed concern about what happens when the single infusion of federal money disappears. Spending increased during the pandemic, despite an economic recession triggered by the security block, a drop in tax revenues and mass layoffs.
McMahon said Cuomo is right to worry about what will happen beyond the next budget cycle or two. The governor and state legislators must prepare a new budget by April 1.
But McMahon is also concerned that Cuomo – beaten and weakened by multiple accusations of sexual harassment and nursing home scandals – may agree more with legislators’ taxes and spending desires than in the past. Prominent Democrats – including Senate majority leader Andrea Stewart Cousins (D-Yonkers) – are asking him to step down.
“The question is whether he is going to try to buy friends. The people on the left would love to take you down, ”said McMahon.