The conservative Tax Foundation that has hammered New York’s business climate and typically ranks it last in the nation had positive marks for the budget deal that includes cuts in corporate taxes.
The changes also come after reports that Gov. Andrew Cuomo’s top aide, Larry Schwartz, has been talking with the Tax Foundation’s vice president Joseph Henchman — who wrote the latest report.
“While some of the targeted credits and programs deserve criticism, the broad-based changes to the corporate tax are impressive and will greatly reduce complexities and burdens in New York’s corporate tax structure,” Henchman wrote.
New York included a number of corporate tax changes in the budget, such as reducing the income taxes to zero for manufacturers. The corporate net income tax rate is also reduced from 7.1 percent to 6.5 percent, the lowest level since 1968, the report said.
Cuomo’s office has regularly been at odds with the group. In October, Cuomo’s office blasted the group’s report that showed New York has the worst business climate in the nation.
The report in October showed New York’s corporate tax system ranked 25th in the nation and its tax structure was the worst in the country.
The new report, released yesterday, said that the new corporate tax changes would move New York to fourth for its corporate tax system. New York would move to 48th for its overall ranking, stepping ahead of New Jersey and California.
“New York is not a low-tax state, and its economic success is because of strengths that overcome a challenging tax environment, with recent tax commission reports recommending many of the changes incorporated in the bill,” the report said.
E.J. McMahon, president of the Empire Center for State Policy in Albany, has praised the corporate tax reforms, including an increase in the threshold for the estate tax — which was blamed for pushing older people to flee New York.
But McMahon and others have knocked a property-tax rebate program that will give tax breaks to homeowners if their local governments stay under a property-tax cap and cut costs.
© 2014 Gannett News Service
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