NY lawmakers will scratch state millionaires’ tax if Trump plan goes through

Democratic lawmakers in Albany who were pushing for a state millionaires’ tax will likely scrap the proposal if President Trump’s tax bill receives the green light in Washington.

Legislative leaders feel that the proposed state tax – added on top of a federal bill that would limit taxpayers’ ability to deduct state and local taxes – could push wealthy New Yorkers out of the state, the New York Daily News reported.

“It would be very difficult to ask those same people (who lose their federal deductions and could pay tens of thousands of more in taxes) to then pay an additional state income tax where that addition is not federally deductible,” New York Assembly Speaker Carl Heastie told the newspaper.

Across the river in New Jersey, state Democrats have said they would nix a similar proposal by Governor-elect Phil Murphy to raise taxes on millionaires.

“I do have that same concern (in New York),” Heastie said.

New York’s Republican-controlled Senate has long opposed Democrats’ proposals to raise taxes on wealthy New Yorkers. Though Democrats are hopeful they can take back the Senate next year, and are looking at a budget deficit projected to be at least $4.4 billion.

Heastie said he would instead look for a “creative way” to plug the deficit, such as raising taxes on millionaires who receive salaries through corporations, which would see their tax rates fall from 39 percent to 20 percent in Trump’s tax plan. [NYDN] – Rich Bockmann