Tuesday, October 06, 2009

New York Income Tax Revenue Falls 36% in Year, Paterson Says

Over the past year there have been dozens of reports of states struggling because of the recession. However, experts were shocked by the huge decrease in revenue the state of New York has seen over the past year. According to an announcement made by New York Governor David Paterson, the states tax revenue has fallen an astounding 36%.

The report comes out after what Paterson describes as a “frustrating” attempt to close the state’s budget gap, which exceeds $2 billion. Checkout the following article on the shocking announcement courtesy of Bloomberg.com.

“We added personal income tax, which we thought would make the falloff 10 percent to 15 percent,” Paterson, a Democrat, said on CNBC today, referring to $5.2 billion in new or increased taxes. “This is what is so frustrating. It’s still 36 percent, meaning our revenues fell more in 2009 than they did in 2008.”

Wall Street companies lost $42.6 billion last year and year-end bonuses to workers fell 44 percent to $18.4 billion. Income tax receipts were down 24 percent as of Aug. 31, according to the state comptroller’s office. Paterson’s estimate includes data since then.

Besides boosting taxes for the fiscal year that began April 1, lawmakers made $5.1 billion in spending cuts. The plan also includes $6.2 billion in federal stimulus money and $1.1 billion in one-time revenue, according to the Assembly.

The budget will still be $2.1 billion in deficit because spending plans exceed revenue projections, the state Division of Budget said July 30. The report predicted deficits of $4.62 billion in 2011, $13.3 billion in 2012 and $18.2 billion in 2013.

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