Gov. Andrew M. Cuomo Wednesday announced a plan to give up to $1.7 billion in tax credits every year to 1.3 million New Yorkers, including more than 300,000 Long Islanders.

The proposal, which Cuomo unveiled in a speech at Hofstra University, would affect households with incomes below $250,000 that pay more than 6 percent of their income in property taxes.

The plan, which would cover residents of municipalities that stay within the 2 percent state property tax cap, is expected to be a central component of Cuomo’s joint State of the State-budget address on Jan. 21 and is the first major policy proposal of his second term.

Cuomo, a Democrat, said the credit on state income taxes would cut “burdensome property taxes” that rank among the highest in the nation.

“This will be the first time there is an actual cut and that is . . . significant progress on what I believe is the major problem facing this state,” Cuomo said.

Cuomo said young people and businesses are fleeing New York for other states where “it’s cheaper to operate. That’s taxes. And you have no long-term future if you are the tax capital of the nation.”

While Cuomo called his plan a tax cut, critics said the credit would merely shift state income taxes to help defray local property taxes.

“He’s shifting more of the burden to the income tax rather than changing policies” that drive up spending, said E.J. McMahon, president of the Empire Center for Public Policy, a nonprofit think tank that promotes free-market policies. “You’re also encouraging more localities and school districts to increase taxes to the tax-cap limit and they can say to residents: ‘Don’t worry, you’ll get it back.’ ”

Households making less than $250,000 but with property taxes exceeding 6 percent of their income would qualify for the recurring annual tax credit. The credit is capped at 50 percent of the amount that property taxes exceed the 6 percent threshold.

The benefit would vary according to income level. The maximum credit would be $2,000 for a taxpayer making less than $75,000, and between $1,000 and $1,500 for taxpayers with incomes of $150,000 to $250,000.

In Nassau County, 207,000 taxpayers would get an average credit of $1,208; in Suffolk, 125,000 taxpayers would get an average of $1,148, Cuomo’s office said.

Statewide, taxpayers would receive an average of $956, said state budget director Bob Megna.

A credit for renters would be available to families that earn less than $150,000.

Once phased in over four years, the proposal would cost $1.66 billion annually.

Cuomo would fund the program using an assumed state surplus that is dependent on keeping spending growth at about 2 percent. The state wouldn’t use any of the $5 billion windfall New York expects from national banking settlements, Megna said.

The State Legislature would have to approve the Cuomo plan.

The Republican-led Senate typically favors tax credits but historically has opposed “circuit breaker” approaches with income limits on benefits. Senate Majority Leader Dean Skelos (R-Rockville Centre) said Wednesday that Cuomo’s plan might not be broad enough.

“It is essential that any enacted property tax relief plan ensures all middle-income families in every region of the state receive property tax relief,” Skelos said.

The Democrat-dominated Assembly favors tying property tax credits to household income, although Assembly Speaker Sheldon Silver (D-Manhattan) was noncommittal Wednesday.

“We support tax relief for working families that is fair and equitable for all New Yorkers,” said Silver spokesman Michael Whyland. “We’ll review the details of the proposal.”

State GOP spokesman David Laska said, “Giving a limited government handout to just a few hardworking taxpayers while ignoring the big picture — [state] mandate relief — is putting a Band-Aid on a bullet hole.”

But liberal groups that have lobbied Albany for years for the circuit breaker approach applauded Cuomo.

“This is what we’ve been asking for, to a certain degree,” said Ron Deutsch, interim director of the Fiscal Policy Institute, a nonprofit research center backed by labor. “We have concerns about how to pay for it. We don’t want to see cuts to human services or education.”

© 2015 Newsday