McDonough Applauds Governor’s Decision To Reduce MTA Tax For Nassau

Payroll tax was passed as part of MTA bailout last year
February 12, 2010

Assemblyman Dave McDonough (R,C,I – Merrick) is supporting Governor Paterson’s proposed plan to reduce his Metropolitan Transportation Authority (MTA) Payroll Tax on Nassau businesses. The governor announced this reduction earlier this week as part of his 21-day amendments to his budget proposal after the MTA claimed it would receive $350 million less than projected due to a weak economy and poor compliance with the new tax.

“I still stand opposed to any tax by the state which harms businesses, especially when that money goes to an organization which is as inefficient and mismanaged as the MTA, but this is a step in the right direction,” said Assemblyman McDonough. “The governor’s idea of ‘regional equity’ as it relates to the MTA is a welcome change from his prior position regarding this tax. It is my hope that in time the MTA will shed excess spending and become streamlined enough that the MTA payroll tax can be eliminated altogether.”

Under the governor’s proposed plan, the payroll tax rate in Nassau and Suffolk counties will be lowered from the current rate of 0.34% to 0.17%, while New York City businesses who currently pay only 0.34%, will pay 0.54%,. This move will increase the payroll tax revenue from $1.31 billion to $1.54 billion.

“Ultimately, the MTA must find ways to provide the necessary services to the 2.6 billion riders who use the MTA yearly without relying on the state to increase taxes. I continue my opposition to this tax and recognize that this proposed reduction for Nassau County is only a small step in restoring equity and accountability to the MTA and the area it services,” concluded McDonough.