New York State Legislature backs higher taxes on wealthy residents

Lawmakers in both chambers of the New York State Legislature have expressed support for increasing taxes on the wealthiest New Yorkers and large corporations, a move that Governor Kathy Hochul has said she does not support.

The separate one-house budget proposals could generate roughly $5 billion in additional revenue for New York City through a combination of new taxes and increased state aid.

New York City Mayor Zohran Mamdani, who has made raising taxes on the wealthy a key policy proposal, welcomed the move. However, the tax increases proposed by lawmakers are smaller than the ones he has previously suggested.

Proposed tax increases

Democrats in the New York State Assembly are proposing to raise about:

• $2 billion by increasing income tax rates for individuals earning more than $5 million annually,
• $1.9 billion from higher corporate tax rates, and
• $95 million from a new tax on cryptocurrency mining facilities.

Meanwhile, Democrats in the New York State Senate aim to generate about $5.2 billion in additional revenue by raising income taxes on top earners and eliminating certain tax breaks for major climate polluters.

Other proposals in the budget plans

The Assembly’s proposal also includes:

• A two-year moratorium on gas and electricity rate increases, and
• Utility rebate checks of up to $500 for consumers.

The Senate’s plan would:

• Increase education funding for school districts with large numbers of homeless students or students who are not fluent in English, and
• Tighten regulations on social media companies’ treatment of minors, including removing certain exemptions for gaming platforms.

Next steps

Both chambers are expected to pass resolutions supporting their budget proposals on Thursday.

Negotiations will then begin between Senate Majority Leader Andrea Stewart-Cousins, Assembly Speaker Carl Heastie, and Governor Hochul, who introduced her preliminary $260 billion executive budget proposal in January.

Under state law, New York’s budget must be finalized by March 31.