The fiscal year 2017-18 budget passed by the state Legislature last week contained an item that one labor leader said will benefit the middle class.

This provision changes New York’s tax law by allowing all workers to deduct their union dues from their state taxes. Union dues could already be deducted from federal and state taxes, but itemized deductions had to exceed 2 percent of a tax filer’s gross income.

This budget item removes this limit on the state level. Mario Cilento, president of the New York State AFL-CIO, praised it as an advantage for working people.

“A key piece included in the final spending plan will make it easier for union members to deduct the cost of their union dues from their state taxes,” he said in a news release issued April 10 by the union. “This new benefit will put an estimated $35 million back into the pockets of our members in private sector, public sector, and building trades unions throughout the state. We welcome this new benefit particularly at a time when the right of working people to join a union is increasingly under attack. The labor movement provides the best way for working people to get ahead, and this new benefit will help us in our fight to continue to grow the middle class.”

Loosening this rule on tax deductions will cost the state an estimated $35 million. But despite what Mr. Cilento claims, dues-paying members of the middle class won’t make up the majority of those who will benefit from this tax goodie.

In an article published April 10 on the NYTorch blog, Empire Center for Public Policy President E.J. McMahon documents the limits of this change in the state’s tax law. Most of those who will take advantage of it have incomes in excess of $100,000 a year.

“Few taxpayers claim miscellaneous deductions on the federal or state levels,” Mr. McMahon wrote. “And itemized deductions in general are not common among the majority of New York taxpayers, thanks to a generous standard deduction — which, at $15,950 for married filing jointly, $11,150 for heads of households and $7,950 for singles, typically exceeds deductible expenses for the average worker or working couple. Higher standard deductions simplify the filing process and provide taxpayers with larger savings than they would collect by itemizing. … (M)ore than 80 percent of filers with incomes below $50,000 and nearly 70 percent of households between $50,000 and $100,000 claim the standard deduction and do not itemize on their state returns. Itemizing becomes more common at income levels above $100,000, and itemizers become a majority among filers with incomes above $150,000.”

The people who will most likely deduct their union dues from their state taxes, Mr. McMahon wrote, include “police officers, firefighters and school teachers in Long Island and the lower Hudson Valley, along with the higher-paid New York City building trades. Downstate workers also are more likely to be already itemizing large deductions for property taxes and mortgage interest on higher-priced homes.”

The payoff of this provision will be limited not only in the number of workers who will benefit but also in what they’ll receive.

“Assuming that one-quarter of New York’s 2 million unionized workers itemize deductions, and that the initially cited budget revenue impact of $35 million is correct, the average tax savings will come to $67,” Mr. McMahon wrote for the Empire Center. “Not so much a giveaway as a gratuity. Think of it as dinner and a movie, on the taxpayers’ dime, flowing principally to some of America’s best-paid public employees. Not incidentally, it’s also an indirect subsidy for the state’s most politically powerful unions.”

As Mr. McMahon stated in his article, the idea to alter the state tax code in this manner came out of nowhere. A public debate on the merits of this proposal wasn’t held, and no standalone bills were introduced to advance the concept. The provision was just slipped in at the last minute.

Given that this budget item will benefit so few people and that its mechanics were hashed out in secret, it’s obvious that it was passed merely to court favor with the state’s most influential unions.

Why are union members — and just the highest paid among them — the only ones who should be able to recoup expenses pertaining to their careers? What about people who pay to be members of professional associations? Wouldn’t a tax break for them help grow the wealth of those in the middle class even more?

This labor union perk was hatched behind closed doors and dropped in the state budget when virtually no one was looking. It will mostly benefit those who can easily afford to pay their own union dues and do nothing for workers who truly need some tax relief.

Does this sound like a genuine advancement for the average worker in this state?

© 2017 Watertown Daily Times