New York Governor Andrew Cuomo announced on Monday that state income tax revenues plummeted by $2.3 billion since he introduced new budget plan last month.
Cuomo believes the revenue drop in December and January is caused largely by the new federal tax code, as well as volatility in the stock market and other uncertainties.
“That’s a $2.3 billion drop in revenues. That’s as serious as a heart attack. This is worse than we had anticipated,” Cuomo said in Albany.
“This reduction must be addressed in this year’s budget.”
State Comptroller Tom DiNapoli confirmed the deteriorating finances.
“This is the most serious revenue shock the state has faced in many years,” he said.
From NY Post:
The loss of revenue from New York’s wealthiest puts New York in a bind because the state relies on a progressive income tax system that taxes the rich at a higher rate.
One percent of the state’s top income earners provide 46 percent of the state’s personal income tax revenues, officials said.
Cuomo said Albany can’t go to the well and tax the wealthy again because that would only worsen the situation, citing “anecdotal” evidence that high-income New Yorkers are already fleeing the state to lower-tax jurisdictions.
Here are some of the best responses to Cuomo’s announcement: