Clinton Flip Flops on NYC Tax Issue

U.S. Secretary of the State Hillary Clinton, and former NYC Senator has come under fire from the city’s mayor for supposedly “stabbing the city in the back.” According to recent reports Mayor Bloomberg has accused Clinton of changing her views on tax exemptions for diplomats staying in NYC, which has resulted in nearly $250 million dollars in losses for the city.

The mayor said it is not only a double cross but also a double flip-flop. As New York's junior senator, Clinton fought to make diplomats pay up. And he said her reversal changes a longstanding policy.

"Since 1873 they've been saying this is taxable," Bloomberg said.

What's more, the mayor predicted that -- freed of paying property taxes -- some governments would see it as a business opportunity to buy up properties and make money renting them out.

"It's just patently unfair to New Yorkers and Americans and it contravenes established policy for 130-odd years and it just doesn't make sense," Bloomberg said.

NYC Personal Income Tax Revenues Plunge In April

From Reuters.com:

New York City's net personal income tax revenues plunged 51 percent in the first 24 days of April, compared with the same period a year ago, the city comptroller's office said on Monday.

New York City's economy has been hurt by the devastation of Wall Street, its largest hometown industry, following the collapse last September of Lehman Brothers Holdings and a series of bank mergers amid the credit crisis. In the month of March alone, for instance, Wall Street shed 3,100 employees, according to the state's Department of Labor.

U.S. states and cities, just like the federal government, usually see tax revenues surge in April because the month includes the April 15th annual tax deadline.

New York City often pays out more in refunds than it collects in taxes during April.

But "through April 24, payments were running 33.5 percent below those of April 2008, and refunds paid out were running 21.8 percent below those of April 2008," said a spokesman for Democratic City Comptroller William Thompson.

The state's economy rests on the city's shoulders because the city's financial sector pays about 20 percent of the state taxes. New York City is equally dependent on the financial sector, with economists saying that each high-paying Wall Street job creates service-sector employment ranging from one to three workers in a broad range of businesses from law firms to clothing stores and little gift shops.

Though the city's real estate market fended off much of the pain seen around the nation until late last year, the depth of its current fall was underscored by the state's mass transit agency.

"We're seeing it declining even faster and deeper than in the post-1987 deflating of the real estate bubble," said Gary Dellaverson, chief financial officer for the Metropolitan Transportation Authority, at a finance committee meeting.

On Oct. 19, 1987, the Dow Jones industrial average .DJI lost 22.6 percent in the largest one-day percentage decline in stock market history. Afterwards, thousands of Wall Street jobs were lost and some never returned.

Democratic Governor David Paterson, speaking to reporters, estimated the state's deficit next year at $2.7 billion.

The state will update its financial plan later this week, he said. New York City also should issue new estimates soon.

While there was a "significant" drop in state corporate tax revenues in March, followed by a decline in personal income tax collections in April, Paterson added that there were signs the economy might stabilize sooner than anticipated.

"However, there seems to be a projection later in the year that things may not be as bad as we first thought that they would be."

The state's current budget cut the three-year deficit to about $11 billion from $16 billion, Paterson added.

NYC Offers Tax Credit For Child Care

From Newsday.com:

The city is urging New Yorkers to claim the new Child Care Tax Credit when filing their taxes this season.

More than 50,000 New Yorkers claimed the credit last year, the first year the city credit was available. Mayor Michael Bloomberg's office says the average refund was $600.

Residents who earn $30,000 or less and pay child care expenses for children age three and under may qualify for the credit.

The mayor is urging families to call the city's information hot line, 311, to find out more information.

Health Commish Defends Paterson's "Fat Tax" on YouTube

From News Day.com:

New York state's top health official appears in a 5-minute YouTube video promoting Gov. David A. Paterson's controversial "fat tax" on soda and other sugary soft drinks.

Health Commissioner Richard Daines is seen on the video standing behind a kitchen counter holding an array of props, including cans of soda, glasses of milk and a football-sized lump of fake fat.

On the video, Daines defends the tax proposal, saying it will help the state fight the spread of childhood obesity and save New York money in health care costs.

Paterson's state budget proposal for fiscal 2009-2010 includes an 18-percent tax on sugary drinks containing less than 70 percent real fruit juice. The governor says the tax would raise more than $400 million in its first year.

Ex-NYC police commissioner Kerik pleads not guilty

From the Associated Press:

Former New York City police commissioner Bernard Kerik has pleaded not guilty to a rewritten indictment in the criminal case against him.

Kerik entered the plea Monday in U.S. District Court. The new plea was necessary because federal prosecutors recently added charges against him.

The new charges stem from allegations that he lied to his accountant about his taxes and made false statements about a loan application.

Kerik is awaiting trial on charges he accepted free apartment renovations, lied to the White House and filed false income tax returns. He also pleaded not guilty to those charges.

A hearing on pretrial motions has been set for Feb. 3.

NYC Mayor Fights $400 Property Tax Rebates in Court

From Reuters:

New York City Mayor Michael Bloomberg said he was fighting the city council in court over whether he has the authority to withhold $400 property tax rebates that he says the city cannot afford.

"We are in court right now," the independent mayor told reporters on Thursday. If the court sides with the Democratic-led council, Bloomberg said the checks would be mailed to homeowners.

"We will always obey the law," he said. If the tax rebates are granted, the city will have to make other spending cuts, he said.

New York is under pressure to close a $1.3 billion deficit in 2009. The mayor's fight with the council is unusual and underscores the severity of the budget problems.

The battle may also test Bloomberg's financial expertise, the cornerstone of his campaign to win a third term.

"We will work with the city council to try to get the right balance" of measures, he said.

NYC Pushing Again for Commuter Tax

From News Daily:

Mayor Michael Bloomberg's budget director told a City Council finance hearing Monday that he and the mayor are eager to lobby again for the tax in Albany, particularly in tough economic times for both the state and city.

Republican state lawmakers recently said they oppose any attempt to revive the tax, but a newly Democratic-controlled state Senate might mean the proposal gets another chance in January.

Commuters who live outside New York City had the tax on their city earnings for 33 years.

It generated as much as $360 million a year for the city before it was eliminated in 1999.