NEW YORK (CBSNewYork) — President Joe Biden’s plan to sock taxpayers with trillions of dollars in new taxes to fix the economy and rebuild infrastructure has received immediate pushback in New York and has created a new headache for tax-the-rich Albany lawmakers trying to craft a new budget.
When Biden was crafting his national recovery plan he probably didn’t count on a Democratic congressman from the North Shore of Long Island throwing a monkey wrench into his plans to raise taxes to pay for it.
“I’m making it very clear — no SALT, no deal,” Rep. Tom Suozzi said.
Suozzi says that unless the president restores state and local tax deductions — price tag $350 million — he will work to round up enough votes to derail the program that counts on about $3 trillion in new taxes, CBS2’s Marcia Kramer reported.
Part 1, announced Wednesday, is $2 trillion in corporate taxes to pay for infrastructure. Part 2, to be announced later, will fund the domestic policy agenda, things like universal pre-K and tuition-free community colleges.
To pay for that the president is expected to seek to increase the top tax rate for people earning over $400,000 a year to 39.6%, among other things.
Suozzi says this is the ideal time to take a stand on SALT since Democrats have only a slight majority in the House — 219 to 211 Republicans.
“They can’t afford to lose a lot of votes. If they lose our votes, they can’t get any deal done,” Suozzi said.
Meanwhile, the federal tax hikes are reportedly causing a massive headache in Albany, where lawmakers want to raise corporate and income taxes by $7 billion.
“The combination of federal and state proposals that are being seriously discussed right now would put their tax burden for high earners at over 60% of their earned income. If they move to Florida, it would be 40%,” Wylde said.
That may be why state budget director Robert Mujica took time out from negotiations to warn that a $7 billion increase might be just too much.
“There is a tipping point,” Mujica said. “Whatever we do on the tax side we want to make sure, right, that we’re striking a balance with funding the items for the recovery, but at the same time not discouraging job growth and not discouraging those jobs from coming back to New York.”
The state budget deadline is at midnight, but Legislature sources told Kramer it’s unlikely lawmakers finish on Wednesday night.