May 17, 2011

Silver Announces Legislation to Prevent a Tax Windfall for Millionaires and to Avoid Unnecessary Cuts in School Aid

As Teacher Layoffs Loom, Legislation Would Fund Our Children's Education

As residents in school districts across the state go to the polls today to vote on school budgets that will slash thousands of teaching jobs, Assembly Speaker Sheldon Silver and Ways and Means Committee Chair Herman D. Farrell, Jr., announced they have introduced legislation (A.7802) aimed at stopping a tax reduction slated to benefit millionaires and multi-millionaires.

The legislation would prevent a lowering of the existing tax rate for the wealthy, help schools stave off the worst cuts, and give them the resources so that our children's education will not be shortchanged. The Assembly's proposal would affect only those earning more than $1 million in adjusted gross income, which constitutes less than one percent of all taxpayers.

"Quite simply, this is a moral imperative. We should not give a special handout to multi-millionaires and billionaires while our children's futures are in jeopardy," said Silver (D-Manhattan), noting that the affluent are already reaping the huge benefits of the Bush-era tax cuts extended by the federal government. "This legislation not only ensures that millionaires and multi-millionaires remain in their current tax bracket until 2013, it also makes certain that a large portion of their contribution goes directly to our schools."

Under the legislation, the current top tax rate of 8.97 percent would be extended through 2012. The bill also creates a special education assistance fund to support school districts and boards of cooperative educational services (BOCES). Under the legislation, 30 percent of the additional revenues collected from the surcharge will be dedicated to school districts.

"School districts across the state are being forced to cut hours, services and programs at the expense of our children," said Farrell (D-Manhattan), adding that thousands of teachers could lose their jobs if the tax handout is allowed to take effect. "It is not unreasonable or unfair to ask someone who is netting more than a million dollars to continue paying the same taxes they have in the past."

"Even with the extension of the surcharge, millionaires and multi-millionaires are seeing a significant net benefit as a result of the extension of the Bush-era tax cuts that lowered the top rate to 35 percent from 39.6 percent," said Silver. "There is no reason, in these troubled times, for New York to give the very rich an even greater tax break."