Governor Andrew Cuomo has blamed the rollback of state and local tax deductions by the federal government as the reason behind a $2.3 billion revenue shortfall which is wreaking havoc on his $175 billion spending plan for 2020.
“Everything we did economically is right,” Cuomo said Monday. “We tightened our belt, we cut taxes, we’re creating jobs, and here’s a penalty just because we are Democrats.”
The federal tax measure, which placed a $10,000 cap on SALT deductions, went into effect last year. Cuomo said the majority of homeowners impacted chose to file their 2017 taxes early to take advantage of the benefit before the change went into effect.
The state had expected a $500 million shortfall in income-tax collections and had adjusted the current budget to close that gap. Only two months are left in the fiscal year to find another $2.3 billion.
John Ravitz, Vice President and COO of the Business Council of Westchester, said that the current predicament is precisely why the BCW has for years urged the Governor and Lawmakers to live within their means and to seek long-range revenue streams, as well as reform laws that increase the cost of doing business in New York State.
The BCW each year releases its Legislative Agenda to State Leaders and top among its recommendations is the passage of on-time, balanced and fiscally responsible budgets.
“Every year the BCW reminds our state leaders that we must have budgets that are balanced,’’ said Ravitz. “This recent news indicates that the state needs to be careful that we don’t pass a budget that is not fiscally sound. Policies to solve the state’s structural and on-going fiscal problems are long overdue.’’