Tax hikes on the wealthy by another name — and in another form — smell a little bit sweeter for some state officials.
No, it’s not the millionaires’ tax, a much-debated but moribund income tax surcharge on those who make more than $200,000. Now, it’s a revamp of the income tax code, which could have the rich paying more and the poor and middle class paying less.
“Generally speaking, I would be in favor of lowering the tax bracket (for middle- and low-income earners) and increasing slightly higher tax brackets,” said Assemblyman Kenneth D. Blankenbush, R-Black River, who has adamantly opposed the millionaires’ tax.
There are a few key differences between the millionaires’ tax and what Gov. Andrew M. Cuomo said he is considering. The millionaires’ tax, a temporary tax set to expire at the end of the year, hikes income tax rates on high earners from 6.85 percent to 7.85 percent, and on the highest earners to 8.97 percent. Without the millionaires’ tax, most people will pay a flat 6.85 percent income tax. A broad-based tax code change would raise taxes on high earners by an amount to be negotiated, and would lower rates for others.
Mr. Blankenbush said that any plan he signed on to would have to be “revenue-neutral.” That is, if rich people paid more than 6.85 percent, any additional money that was raised would be made up for in tax breaks to the middle class and the poor. He also said that rates on the rich shouldn’t be as high as they are under the temporary millionaires’ tax.
“We don’t have a revenue problem. We have a spending problem,” Mr. Blankenbush said, repeating a well-known Republican mantra.
Assemblywoman Addie J. Russell, D-Theresa, a strong proponent of the income tax surcharge, said that she, too, would consider changes to the income tax code and tax breaks for middle- and lower- income earners. But, unsurprisingly, she differed from Mr. Blankenbush on revenue. She said that tax increases on the wealthy shouldn’t just pay for tax breaks for the middle class and the poor.
“We certainly need to have a net gain in revenue that is enough to actually do something substantive,” she said. “Otherwise, we’re just playing a shell game. It needs to be more than just a trade-off.”
The north country’s Republican state senators, Joseph A. Griffo and Patricia A. Ritchie, walked around the issue lightly. They have pledged not to raise taxes, but polls indicate public support for taxing the wealthy at a higher rate. Plus, the state is facing a possible $3.5 billion budget deficit next year. The political might to close the gap without raising taxes in the union-heavy state, after closing a $10 billion deficit via cuts last year, might not exist.
“While Senator Griffo would support an exhaustive look at the tax code to make it fairer and easier to understand, using it as a prop to reach into some deep pockets to close a short-term gap could have detrimental consequences,” Mr. Griffo’s spokesman, Rayan Aguam, said in an email. “We think that restructuring and reforming Medicaid or legalizing mixed martial arts bouts or changing the casino gaming laws could also be a good start to raising additional revenue for the state.”
In an interview, Mrs. Ritchie said she wasn’t sure whether she would support changes to the tax code, revenue-neutral or not. That means that Mrs. Ritchie would not comment on whether or not she would vote to raise taxes.
“I can’t really comment until I see the proposal that the governor has out there,” she said. “Anything that has the potential to give relief to middle class families is something that I’ll look at.”