Governor Kathy Hawkle has promised not to raise income taxes on New Yorkers next year, saying she doesn't want businesses to flee the state.
The Democrat, who infuriated the left wing of his party by refusing to raise income taxes in this year's state budget, said Friday he wants to stay that course in 2025.
“I'm not going to raise income taxes,” Hoekl told a packed house of executives at the New York State Business Council's annual meeting at the Sagamore Resort, a luxury resort hotel in Lake George.
“I want you to stay here and I want you to grow. I want you to be successful,” she said. “That's my promise to all of you.”
Currently, single New Yorkers making between about $14,000 and $215,000 pay a 5.5% to 6% income tax. High-income earners in the state, those making more than $25 million a year, pay a 10.9% tax.
“The Governor remains correct that New York should not further raise personal income taxes, which are already the highest in the nation,” Patrick Orecchi, state research director for the Citizens Budget Commission, said in a statement to The Washington Post.
“High taxes make us less competitive. The state should aggressively curb spending growth and end the current temporary additional taxes,” he said.
But progressive groups slammed Hoekl for the promise.
“By getting the ultra-wealthy to pay a little more in taxes, our state can make much-needed investments in our communities. We want the Governor to stand with working families and New Yorkers struggling with the rising costs of basic necessities like rent, groceries and child care,” said Jasmine Gripper, co-chair of the New York Working Families Party.
Haukle's vow comes as he prepares to face a major dilemma with the state Legislature over how to fund the MTA's next five-year capital plan.
Metropolitan Transportation Authority CEO Jano Lieber this week requested a massive $68.4 billion for the agency's 2025-2029 capital plan, the largest budget request in the agency's history.
Albany also must figure out how to fill a $16.5 billion hole in the MTA’s existing capital plan, which was to be funded with cash from the much-derided congestion pricing program that Gov. Hokell suspended earlier this year.
The state will enter the next budget year with a $2.3 billion deficit, and the state has carried a combined $11.6 billion deficit over the following two bienniums.
Speaking to reporters early Friday, Gov. Hokell said the state's fiscal outlook is bright, pointing to the stock market's rally this week.
“Much of our budget is driven by Wall Street, so final numbers will be released at a later date.” [but] “I love the current trend,” she said at another event.
“Interest rates are going to have a positive impact. The unemployment rate is doing well and is only slightly higher than many other places,” Hokele added. “So I'm looking at all of these economic factors and I'm painting a brighter outlook than I did in my first few years in office.”
While Hokel is drawing the line at income tax, Albany has plenty of other ways to line the pockets of New Yorkers.
After pumping the brakes on congestion pricing, which would impose a $15 toll on drivers traveling below 60th Street in Manhattan, Hawkle proposed increasing the payroll transfer tax in private negotiations with lawmakers.
But with a significant number of Democrats opposed to the tax increase, it remains unclear how the state will fill the gaps in the MTA's 2020-2024 capital plan.
