End of the $400 Property Tax Rebate
Since 2004, $400 rebate checks have been sent out to homeowners courtesy of the Bloomberg administration. Well, no more. The mayor is immediately axing the program, reports the NY Times, to help shore up the expected $4 billion budget deficit. Other quick fixes: raising personal income tax by as much as 15 percent; hiking the…
Since 2004, $400 rebate checks have been sent out to homeowners courtesy of the Bloomberg administration. Well, no more. The mayor is immediately axing the program, reports the NY Times, to help shore up the expected $4 billion budget deficit. Other quick fixes: raising personal income tax by as much as 15 percent; hiking the city’s portion of the state sales tax by as much as three percent; and charging a nickel for every plastic bag a consumer picks up at a store. “The mayor also detailed $1.5 billion in proposed budget cuts that would affect virtually every agency in city government,” they write. “The measures include closing libraries for a half day, eliminating dental programs and closing a clinic in East Harlem.” Should Wall Street rally and the economy heal, the mayor said, checks will go out again.
Mayor Cancels Rebates for Homeowners [NY Times]
Photo by tienmao.
Z – wait a minute, are you sure that the net of someone making 250K is as low as 130K? What about the many deductions people often get on their taxes? What we really need to be talking about is ADJUSTED gross income, which is quite different than gross and hence subject to significantly less tax. Any accountants want to jump in the mix here?
Geekspice;
Obviously I don’t know how old you are, but I am wondering if you lived through the city’s decline from the late 60’s to the early 90’s? I can’t believe that you lived through it and make the statement that you do. Your statement is quite similiar to that made by the City Fathers during the City’s decline of that time. They could never get themselves to believe that business would flee from NYC, even though in fact it was happening right before their eyes. Taxes upon taxes were heaped on the remaining bsuinesses, all with the thought/arroagance that they were not going anywhere. The City lost 100’s of corporate HQ’s at that time. A small sample: Pepsico, Texaco, GE, AT&T and General Foods.
I am not making this up. Take a look at the history of this period.
Snarkslope, there are also plenty of people in this particular city who don’t earn anything and don’t get included in household income figures. Nevertheless, 250K to them is peanuts. NYC is unusual in this.
These arguments against the commuter tax are pretty old and tired. We have to face facts: Maintaining services and facilities in NYC costs money. The money has to come from somewhere, and in lean times those somewheres become a lot more scarce. Fairness dictates that the costs should be borne in some measure by all the people who use the services and facilities in question.
If all the commuters will agree to not use the subways, the streets, the water and sewage systems, the licensed taxis and limousines, and everything else that is funded, administered, and licensed by the municipal government, then they should be exempted from paying taxes to NYC. Otherwise, they should go and try to find a job out in the boondocks somewhere that pays like the one they have in NYC. Good luck with that.
Business isn’t going to flee the city because the commuter tax comes back. There are a million reasons that firms want to be based in NYC. The tax structure isn’t and never has been one of them.
benson – thanks for the breakdown. I was not implying that $250K makes one rich. It just happens to be much more than the vast majority of people in the city earn.
Tybur6;
Your question is a very good one, and I could spend an hour on this topic.
Have you ever heard of the phenomenon called the “Dutch Disease”. If not, I’ll try to explain it briefly. It is an economic phenomenon wherein a country with a lucrative commodity business, in particular oil, finds that its other industries cannot compete. The reason it is called the Dutch Disease is that it actually happened in Holland. The oil industry is so lucrative that prices, exchange rates, housing, etc. adjust to it, to the detriment of its other industries.
I think something akin to that has happened in NYC, except that our sugar daddy has been Wall St. The salaries, housing prices, etc. have adjusted to the huge incomes of this once-lucrative industry. As this sector continues to implode, I think we are in for a VERY rough time.
I think you can find symptoms of this “neo-Dutch Disease” right on the commentary of Brownstoner (I am thinking of Lisa’s worldview, in particular). There is unhealthy dose of non-reality in this commentary that can only be sustained when times are extremely flush.
Not too long ago, I saw it argued in Brownsotner that builders should be required to demolish buildings piece-by-piece, so as to salvage every possible material, even though it was reported that such an approach would be much more labor-intensive and would drag out the project schedule consderably.
All of the folks who argued for this approach never considered the cost of this approach, and how it would make NYC’s real estate more unaffordable. You talk about “luxury”?? This is true luxury!!
I think we are in for a long, hard ride as NYC and the folks here crash back into reality.
Tybur6,
New York has always been more expensive than most parts of the country, but has remained a place where businesses want to set up shop. I think a large part of that is that young, well edeucated people want to live here. This gives businesses a broad talent pool to draw fromm.
So… to round out the economic argument… Why would ANY business want to set up shop in New York City? They would have to pay everyone enormous salaries to be attracted to work there.
Do you really think these residential real estate price tags are going to be sustainable? Or will the jobs and people move elsewhere…. I think taxes are the least of our worry. If $250k is “not a lot of money,” then there is something FUNDAMENTALLY wrong with this city and it’s going to slap us in the face hard and fast!
z I think points out an unfortunate but accurate fact about NYC and that is 250G just isn’t the same here as it is in other parts of the country, at least as expressed in terms of how much (if any) house it gets you.