Today’s Times has an article about the city’s efforts to lure more of the biotech industry to New York by subsidizing real estate in Brooklyn and Manhattan. It inadvertently makes the case for across-the-board tax cuts.
“Financiers from Silicon Valley have been picking off many of the most marketable ideas for new ventures and persuading their founders to set up shop in established biotech centers where operating costs are significantly lower than in New York City, like San Diego or Cambridge, Mass.,” the Times reports.
Those higher operating costs include the highest combined state and local tax rates in the country, including a commercial-rent tax in Manhattan.
As the city’s real estate market declines, private-sector costs may go lower, but unfortunately, taxes may go up. Since the city can subsidize only a relatively few companies with real-estate and other breaks, those left out may go elsewhere.