NEW YORK (CBSNewYork) — A slick new television ad makes a promise most business owners would jump at: Start-up or expand a business in New York and enjoy a 10-year exemption from property, sales and even state income taxes.
As CBS 2’s Tony Aiello reported Friday, it’s a pet project of Gov. Andrew Cuomo, but can it really live up to the hype?
“It’s one of the most expensive places in the country to do business. And that’s a problem,” Cuomo said.
Cuomo admits the problem and thinks he has part of the solution: a new ad campaign is touting his “Start-Up NY” initiative.
Move here, expand here or start a new business here and pay no taxes for 10 years, that’s Cuomo’s pitch. The “no tax” pledge extends to employees of qualifying companies. They’d pay no state income tax for a decade.
“Best I know, it’s never been done in the country before,” Cuomo said.
A scholar at the Manhattan Institute thinks “Start-Up NY” has potential, but there’s one problem.
“These programs around the country, when they’re put in place, they always tend to be far more complex than they’re advertised,” the Institute’s Steve Malanga said.
The ad doesn’t mention wholesale and retail businesses, restaurants, medical services and many more that can’t qualify.
The focus is on high-tech and advanced manufacturing firms, willing to locate at properties on or near college campuses.
Right now there are only 18 “Start-Up NY” properties downstate, versus more than 90 upstate.
Qualifying businesses could lose their tax-free status if they don’t create jobs as promised.
“Because otherwise, opponents will say legitimately, ‘it’s just a giveaway.’ But it does in that respect entail a certain amount of risk for the businesses,” Malanga said.
And maybe there could be a certain amount of reward for Cuomo.
“It does give him the ability to say, ‘look at everything I’m trying.’ The question becomes whether people then say back, ‘but what are the results, and have there been any results? We’ll see!” Malanga said.
The first “Start-Up NY” winners will be announced next year, which also happens to be a re-election year for Cuomo.
The Empire State Development Corporation says already more than 1,000 companies and entrepreneurs have expressed some level of interest in “Start-Up NY,” Aiello reported.