Governor Andrew Cuomo has admitted he will consider taxing wealthy New Yorkers if the federal government doesn’t provide aid – just weeks after he begged the rich to return to help save the city from economic ruin.
Facing a huge budget shortfall, Cuomo has so far resisted calls to tax the rich – many who have fled New York City amid the COVID-19 pandemic – over fears they may never return.
He has now acknowledged for the first time since COVID-19 forced the city to shutdown that raising taxes might be part of the solution.
Cuomo said, however, that hiking taxes on wealthy New Yorkers would be a last resort if all other aid options fell through.
New York City is currently facing a $8 billion budget deficit, which is expected to grow in the coming years. The city’s economy has been devastated by the coronavirus outbreak with tens of thousands of people thrown out of work and businesses forced to shut down.
Governor Andrew Cuomo admitted for the first time this week that he will consider taxing wealthy New Yorkers if the federal government doesn’t provide aid – just weeks after he begged the rich to return to help save the city from economic ruin
‘We have a deficit. We don’t just have an economic deficit – we have a combination of factors that are hurting New York City,’ Cuomo said on Tuesday.
‘Before you talk about tax increases in New York City or New York state, let’s first focus on the better options.’
Cuomo said the best and ‘fair’ solution would be a coronavirus relief package from the federal government that bails out the states that have been devastated by the pandemic.
He said that if tax increases were imposed on multi-millionaires and billionaires it should firstly be done on a federal level and not a state one.
Cuomo has previously argued that New York would be at a disadvantage if taxes were only hiked on a state level because it means the wealthy would just abandon the city and go elsewhere.
He said that if a federal relief package or tax increases on a federal level failed, the governor acknowledged that the ‘third level of hell’ would involve a combination of revenue raising, budget cuts and borrowing.
‘You would have to do all of the above,’ Cuomo said.
‘You’d need additional revenues. You’d need cuts. And you’d need potential borrowing.
‘I don’t want to go there because I don’t want to suggest that I am accepting any position other than the fair position, which is the federal government provides funding.’
New York City is currently facing a $8 billion budget deficit, which is expected to grow in the coming years. The COVID-19 pandemic has devastated the city’s economy with businesses forced to shut down. Pictured above is shuttered stores in Manhattan’s SoHo neighborhood
The city’s economy has been devastated by the coronavirus outbreak with tens of thousands of people thrown out of work and businesses forced to shut down. Pictured is a usually busy street near Times Square
Cuomo said that currently ‘Washington is doing absolutely nothing’ but added that he was optimistic lawmakers would take short-term action.
The acknowledgment that taxing the wealthy was a potential option comes just weeks after Cuomo publicly begged the top 1 percent of the city’s residents to return to help save it.
He has fought off calls from other lawmakers to raise their taxes because he fears the move could permanently drive wealthy New Yorkers out of the Big Apple for good.
Thousands of New York City residents fled Manhattan and Brooklyn earlier this year when the city was the COVID-19 epicenter of the world.
Many flocked to their second homes in the Hamptons or upstate, while others rented or bought new properties, abandoning their expensive city apartments.
At a press conference early last month, Cuomo said of the wealthiest residents who have long left the city: ‘I literally talk to people all day long who are in their Hamptons house who also lived here, or in their Hudson Valley house or in their Connecticut weekend house, and I say, “You gotta come back, when are you coming back?”
“‘We’ll go to dinner, I’ll buy you a drink. Come over, I’ll cook.”
‘They’re not coming back right now. And you know what else they’re thinking? If I stay there, I pay a lower income tax because they don’t pay the New York City surcharge.’
He added: ‘A single per cent of New York’s population pays half of the state’s taxes and they’re the most mobile people on the globe.’
The acknowledgment that taxing the wealthy was a potential option comes just weeks after Cuomo publicly begged the top 1 percent of the city’s residents to return to help save it from economic ruin
It comes as residential and commercial properties continue to lie abandoned across the city, crime is soaring, homelessness is rife and the streets are overflowing with rubbish due to budget cuts to essential services.
Mayor Bill de Blasio, however, has previously dismissed rich New Yorkers who fled the city as ‘fairweather friends’ and insisted that their taxes should be raised.
De Blasio has a personal net worth of $2.5 million.
‘It’s time to look it in the face and say you know what? Wealthy New Yorkers can afford to pay a little bit more so that everyone else can make it through this crisis,’ de Blasio said just days after Cuomo pleaded for residents to return.
He insisted the city would ‘not make decisions based on the wealthy few’ and blasted wealthy residents saying that ‘as everyone else is suffering the rich are getting richer’.
De Blasio himself has fared well amid the pandemic, raking in $9,000-a-month from three rental properties as an ample side hustle to his $258,000 salary as mayor.
‘I was troubled to hear this concept that because wealthy people have a set of concerns about the city that we should accommodate them, that we should build our policies and approaches around them,’ he said at the time.
‘That’s not how things work round here anymore.
‘This city is for New Yorkers, this is for people who live here, work here, fight to make this place better, fight through this crisis.
‘There’s a lot of New Yorkers who are wealthy, who are true believers in New York City, who will stand and fight with us and there are some who may be fair weather friends but they will be replaced by others.’