Tax Cuts Spur Economic Growth
Anyone who receives a paycheck noticed a positive difference in their take-home pay beginning last month. Thatís because the federal government instituted a 2% Social Security tax cut, which is based on income. Though 2% doesnít sound like a lot, this adds up over the course of a month or a year on the average paycheck. It is estimated the tax cut will provide the average family with an extra $1,000 in spending. The economy experienced positive growth as a result of the tax cut and economists say itís a good compliment to what appears to be the end of the recession. Statistics out last week estimate consumer spending is up slightly due to the tax cut. Our nation saw jobs grow last month as wellóthe most since last spring.
We all are aware of the high taxes we pay in New York. There are several bills in the Assembly that I support and/or sponsor that, if passed, would lower taxes. The first thing we need to do is create jobs. Jobs, jobs, jobs. Iíve said it before and will continue to as long as we have policies that hinder job growth. Iíve heard of a number of instances from county and local leaders who say theyíve been able to attract businesses here to look seriously at a job creation site. In the end, unfortunately, many business owners donít end up locating here. Much of that can be attributed to the high energy costs, due to built-in taxes, as well as property taxes that are higher in New York than in a neighboring state. These experiences not only take the wind out of the sails of local industrial development agencies but ultimately limit job growth.
To stop this trend, I support the Cornerstone and Discovery Program (A.11302). This would replace the Excelsior Jobs Program. This program would cut business taxes by $150 million through reductions in the corporate franchise, banking, insurance, s-corp, utilities and telecommunications taxes. It also would promote job retention through tax credits for businesses that have been in the state for 10 or more years. Ultimately, we need to try harder to keep the jobs we have. This program also would provide tax credits for new jobs created in manufacturing, high-tech, bio-tech, clean-tech and agri-business.
Energy costs are a major deterrent to attracting and retaining businesses. Residential consumers pay nearly 62 percent more per unit for electricity than the national average. Natural gas prices in New York are 28 percent higher than the national average. Iím pleased the Governor has proposed more affordable energy to manufacturers for a longer period so they can plan accordingly; however, we need to improve energy costs for residents as well as small businesses. Energy is at a premium because supply is down. If we pass legislation to site another nuclear facility, for example, this would automatically lower costs. If we reduce the taxes assessed to power companies, they would pass those savings onto businesses and residents. Two years ago, energy taxes increased in the state, only making the invitation to businesses less attractive. I support energy tax repeals in the Assembly.
Real property and sales are other major taxes that, if reduced, would improve the economy for businesses and residents alike. It remains to be seen if the legislature will pass a property tax cap, which would help substantially. We do need to reduce state mandates for county and local governments, however, if we are to truly lower property taxes.
If you have any questions or comments on this or any other state issue, or if you would like to be added to my mailing list or receive my newsletter, please contact my office. My office can be reached by mail at 200 North Second Street, Fulton, New York 13069, by e-mail at email@example.com or by calling (315) 598-5185. You also can friend me, Assemblyman Barclay, on Facebook.