After President Donald Trump proposed allowing Americans to pay their taxes based on their primary residence rather than where their job is physically located, Governor Andrew Cuomo prophesied that it would not bode well for New York City’s recovery.
With wealthier New Yorkers having fled to cushier conditions in second homes, Cuomo believes that big cities will not be able to get back on their feet to fund basic services and lead to a decline in quality of life in the five boroughs.
His comments in Thursday’s press briefing buttressed earlier statements of his that a millionaire’s tax would also worsen the city’s fiscal situation by motivating more of the wealthiest to leave the state and continue to work remote as has become the norm for many who remain employed through the pandemic.
“If the federal government passes that law and they can now pay their taxes for this period from their residence in Wyoming or their residence in Suffolk… Rather than New York City, that is going to be a major impact on New York City. And the more you see these people and businesses comfortable working from home outside of the city, the more challenging it’s going to be to get these back,” Cuomo said.
The proposal with the HEALS Act also specifically states that those working within a state for less than 30 days per year 2020 and 2024 would be exempt from that specific state’s income tax collection.
New York City is currently grappling with a $15 billion deficit due to revenue loss from COVID-19 while the state has its own set of budget shortfalls. Economic recovery concerns have been at the forefront since the beginning of the pandemic with the MTA requiring up to $8 billion from the federal government just to make it through 2021.
Now the MTA expects a major defict, $16 billion by 2024, a predicament shared by transit agencies nationwide including the Port Authority which today detailed a $3 billion shortfall in capital improvements that will surely stall the completion of the expansions to JFK and LaGuardia airports. PANYNJ Executive Director Rick Cotton said this could not only stem the flow of air traffic to the region, but a lack of funding would also be a jobs killer.
MTA and PANYNJ are just one of many transit agencies that will get not money in the $1 trillion stimulus bill introduced by Senate Republican in the HEALS Act, lieu of the HEROES Act.
State and local governments get no support from this bill either, but discussions in Washington continue.