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Fiscal watchdogs caution lawmakers on raising taxes on wealthy

ALBANY — Fiscal watchdogs are cautioning lawmakers against raising taxes on the wealthiest New Yorkers to plug the deficit, a move they said could prompt wealthy residents to move elsewhere.

State legislators and labor unions have been pushing for New York to increase taxes on the wealthy by bumping up the tax brackets for New Yorkers who make $1 million or more annually, and implementing a “pied-a-terre” tax on secondary homes in New York City and a new capital gains tax on more than 100 billionaires living in the state.

But David Friedfel, director of state studies for the Citizens Budget Commission, said increasing those taxes could be the impetus for wealthy New Yorkers to flee to a state with lower taxes.

“I think it’s very important for policymakers to be cognizant that New York’s competitive advantage is not guaranteed in that particularly wealthy people make decisions based on the impact of their bottom lines,” Friedfel said. “They may choose to leave New York and take all their income with them.”

A report released by the Citizens Budget Commission shows businesses operating in New York City are already subject to the highest corporate franchise taxes in the country when …read more

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