Bill S103A-2013

Reduces personal income tax rates for the middle class

Reduces personal income tax rates for the middle class.

Details

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  • Jan 28, 2014: PRINT NUMBER 103A
  • Jan 28, 2014: AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • Jan 8, 2014: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • Jan 9, 2013: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Memo

BILL NUMBER:S103A

TITLE OF BILL: An act to amend the tax law, in relation to reducing personal income tax rates

PURPOSE: This bill would make the lower tax rates put into effect in 2011 permanent.

SUMMARY OF PROVISIONS:

Section one makes the lower tax rates put into effect in 2011 for, joint filers making less than $300,000 permanent. Section two makes the lower tax rates put into effect in 2011 for heads of household filers making less than $250,000 permanent. Section three makes the lower tax rates put into effect in 2011 for single filers making less than $200,000 permanent. Section four states that this act shall take effect immediately.

EXISTING LAW: The lower tax rates on middle class families put into effect in 2011 are scheduled to expire in 2018.

JUSTIFICATION: With the tax reforms of 2011, middle class families in New York now pay the lowest tax rates they have in nearly 60 years. Thanks to these reforms, over four million New Yorkers saw their tax rates go down and the typical middle class New York family will save between $300 and $400 per year.

Unfortunately, these tax reforms are set to expire in 2018. For many middle class families, this will result in a four to five percent tax increase. Wealthier families will see larger cuts in dollar amounts, but as a percentage of their income these cuts will be significantly less. A family making one million dollars pays more than eleven times as much in personal income taxes as a family making one hundred thousand dollars, but will get less than four times the reduction in tax liability from this legislation. Making the middle class tax cuts permanent is essential to preserving New York's consumer base, as middle class families tend to spend a high percentage of their income within the State. At the same time, it is necessary that the higher tax rates on small businesses and job creators expire as scheduled.

Preserving the middle class tax cuts while allowing the temporary higher tax rates to expire will be a powerful one-two punch combination for the New York economy. Middle class families will continue to see reduced rates, allowing for increased consumption. At the same time, small businesses will see their tax rates return to previous levels, allowing for increased investment and expansion.

LEGISLATIVE HISTORY: 2011-12: S.7845 Referred to Rules

FISCAL IMPLICATIONS: To be determined.

EFFECTIVE DATE: This act shall take effect immediately.


Text

STATE OF NEW YORK ________________________________________________________________________ 103--A 2013-2014 Regular Sessions IN SENATE (PREFILED) January 9, 2013 ___________
Introduced by Sen. GALLIVAN -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Govern- ment Operations -- recommitted to the Committee on Investigations and Government Operations in accordance with Senate Rule 6, sec. 8 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the tax law, in relation to reducing personal income tax rates THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subparagraph (B) of paragraph 1 of subsection (a) of section 601 of the tax law, as amended by section 1 of part FF of chap- ter 59 of the laws of 2013, is amended to read as follows: (B) For taxable years beginning after two thousand seventeen, the following brackets and dollar amounts shall apply, as adjusted by the cost of living adjustment prescribed in section six hundred one-a of this part for tax years two thousand thirteen through two thousand seventeen: If the New York taxable income is: The tax is: Not over $16,000 4% of taxable income Over $16,000 but not over $22,000 $640 plus 4.5% of excess over $16,000 Over $22,000 but not over $26,000 $910 plus 5.25% of excess over $22,000 Over $26,000 but not over $40,000 $1,120 plus 5.90% of excess over $26,000 Over $40,000 BUT NOT OVER $150,000 $1,946 plus [6.85%] 6.45% of excess over $40,000
OVER $150,000 BUT NOT OVER $9,041 PLUS 6.65% OF $300,000 EXCESS OVER $150,000 OVER $300,000 $19,016 PLUS 6.85% OF EXCESS OVER $300,000 S 2. Subparagraph (B) of paragraph 1 of subsection (b) of section 601 of the tax law, as amended by section 2 of part FF of chapter 59 of the laws of 2013, is amended to read as follows: (B) For taxable years beginning after two thousand seventeen, the following brackets and dollars amounts shall apply, as adjusted by the cost of living adjustment prescribed in section six hundred one-a of this part for tax years two thousand thirteen through two thousand seventeen: If the New York taxable income is: The tax is: Not over $12,000 4% of taxable income Over $12,000 but not over $16,500 $480 plus 4.5% of excess over $12,000 Over $16,500 but not over $19,500 $683 plus 5.25% of excess over $16,500 Over $19,500 but not over $30,000 $840 plus 5.90% of excess over $19,500 Over $30,000 BUT NOT OVER $100,000 $1,460 plus [6.85%] 6.45% of excess over $30,000 OVER $100,000 BUT NOT OVER $5,975 PLUS 6.65% OF $250,000 EXCESS OVER $100,000 OVER $250,000 $15,950 PLUS 6.85% OF EXCESS OVER $250,000 S 3. Subparagraph (B) of paragraph 1 of subsection (c) of section 601 of the tax law, as amended by section 3 of part FF of chapter 59 of the laws of 2013, is amended to read as follows: (B) For taxable years beginning after two thousand seventeen, the following brackets and dollars amounts shall apply, as adjusted by the cost of living adjustment prescribed in section six hundred one-a of this part for tax years two thousand thirteen through two thousand seventeen: If the New York taxable income is: The tax is: Not over $8,000 4% of taxable income Over $8,000 but not over $11,000 $320 plus 4.5% of excess over $8,000 Over $11,000 but not over $13,000 $455 plus 5.25% of excess over $11,000 Over $13,000 but not over $20,000 $560 plus 5.90% of excess over $13,000 Over $20,000 BUT NOT OVER $75,000 $973 plus [6.85%] 6.45% of excess over $20,000 OVER $75,000 BUT NOT OVER $200,000 $4,521 PLUS 6.65% OF EXCESS OVER $75,000 OVER $200,000 $12,833 PLUS 6.85% OF EXCESS OVER $200,000 S 4. This act shall take effect immediately.

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