New York lawmakers are nearing a deal with Governor Andrew Cuomo to raise taxes on New York City’s highest earners.
The income tax proposal, which is part of the state’s budget negotiations, would create two new temporary personal income tax brackets for the city’s millionaires, the New York Times reports. People who make between $5 and $25 million would pay 10.3 percent of their earnings; and those who make more than $25 million would pay 10.9. Currently, the highest income tax bracket is 8.82 percent, which applies to single filers making $1,077,550 or more. (Joint filers who make $2,155,351 or more fall within the same bracket.)
After factoring in New York City’s top income tax rate of 3.88 percent, wealthy people could pay between 13.5 percent to 14.8 percent in state and city taxes. Together with corporations—another target of tax hikes in this year’s budget proposals—the rich could contribute an extra $4.3 billion a year, some of which would go toward education spending and support for small businesses that were devastated by the pandemic, according to the Times.
Taxing the rich is often treated as a radical proposition when in reality it’s a pragmatic approach to strengthening social programs and addressing inequality. Many of the bold, universal policies Republicans and moderate Democrats deem too far-fetched become possible by simply raising taxes on the ultra-wealthy.
The tax increases on the rich are a huge win for progressives in the state, who have long argued that the state’s tax system is outdated and unevenly divided: “There are four brackets for people making less than $21,000 per year while everyone else pays basically the same, flat rate,” reads a graphic on the NYC-Democratic Socialists of America #TaxtheRich campaign site. Their calls have only become more urgent as the rich continued to get richer during the pandemic.
“Thanks to thousands of New Yorkers who took to the streets and the ballot box, tireless advocates and grass-roots organizers, and the new Democratic legislative power in Albany, we are beginning to transform New York from a state that protects the wealthy to a state that delivers for the many,” said Rebecca Bailin, the campaign manager for the Invest In Our New York Coalition, which includes the DSA, told the Times.
In November, San Francisco voters approved a wealth tax known as an “overpaid executive” or “CEO” tax, which applies to companies in the city where executives make more than 100 times the median salary of their workers. It’s expected to generate as much as $140 million a year, money that city Supervisor Matt Haney told the Guardian will go toward health services. That same month, voters in Multnomah County, Oregon, voted to raise taxes for the county’s highest earners in order to fund what will be the country’s most progressive universal preschool program: Not only will it provide tuition-free preschool for all children ages three and four, the measure will also raise preschool teachers’ salaries from $31,000 to $74,000.
Just imagine what else we could do if the rich paid their fair share.