Make no mistake: New York and other states became targets of the federal government when they expanded Medicaid for those in need. This malicious attack on vulnerable patients—on health systems that provide care to the under-served, uninsured and others who rely on fair and equitable funding—will do irreparable harm to millions of Americans.
That’s why we’re working with a coalition to fight cuts to healthcare and to make the super wealthy pay their fair share.
The federal tax rates that go into effect with the 2018 tax year filing are a giveaway to the very rich on a massive scale. According to the Joint Committee on Taxation the new tax law will cost the federal budget an estimated $1.5 trillion over the next decade in lost taxes.
Scions of corporate America
Not fully satisfied with all the money the most privileged will receive from the reduction in tax rates, the new law gives them even more, creating “a powerful incentive for super-wealthy Americans to shelter large amounts of income in corporations,” says the Center for Budget and Policy Priorities. Once qualified as corporate money, the super-rich take advantage of slashed corporate tax rates. The law, reports the Tax Policy Center, “has turned us into a nation of tax shelter hunters.”
What about our nation’s children? The Child Tax Credit that gave some relief to working families in past years has been changed. The result is that 10 million children under 17 in low-income households will receive a token $75 or less, while a family of four with $400,000 in annual income qualifies for a credit of $4,000.
The fight back in New York State
Our allies at the organization, Strong Economy for All Coalition, have proposed several state tax initiatives that would bring more fairness and offset the federal tax cuts.
Assembly Speaker Carl Heastie and the Assembly Majority Conference have proposed new state tax brackets “to capture the explosion of income and wealth among multi-millionaires and billionaires,” says Strong Economy. By their account, additional brackets for marginal income over $5 million a year, $10 million and $100 million would raise over $2.1 billion annually.
There is also attention to “carried interest,” a gaping loophole that allows the richest to pay the lower capital gains tax rate on fees they reap from investor-clients. To address this gross inequity, Governor Andrew Cuomo included a state-level “carried interest fairness fee” in his budget. Estimates are that this fee would raise over $3.5 billion a year.
Look around at the towers in the sky proliferating New York City’s skyline. One condo sold recently for $238 million to Chicago hedge fund billionaire Ken Griffin—the most expensive residence ever sold. There are approximately 75,000 apartments in New York City owned by people who don’t live in the city full time.
Third, fourth, fifth residence…
That’s why Strong Economy and its allies are proposing a Pied-à-Terre Tax. It’s a sliding scale surcharge on luxury condos and other residences that are second, third, fourth—even fifth—homes of the richest of the rich. The highest surcharge would apply to homes valued at more than $25 million. In 2017, New York City had a 15 percent one-year increase in residents with over $30 million in assets—it’s now home to 103 billionaires.
Senator Brad Hoylman and Assembly Member Deborah Glick are sponsors of legislation that would put in place both a carried interest fairness fee and the pied-à-terre tax.
A tax on the uber wealthy would raise billions. This money could be directed to better the public schools, fund needed infrastructure, housing and healthcare for all.
Which takes us to the Medicaid cuts triggered by the federal attack on New York and other states (see pp. 8-10). These billions in additional tax revenue described above would help address the Medicaid shortfall we are facing today. The federal tax policy falls hardest on the real safety net hospitals that provide care to the underserved, communities of color and rural residents where healthcare resources are scarce. These tax revenues would make all the difference addressing the compelling health needs of today.
With our coalition fighting for greater equality in taxation, we can make the difference in the lives of working New Yorkers!