Clay It is no secret that New York’s residents and businesses are over taxed. For years, businesses and residents have been leaving New York for tax-friendly states. The fiscal problems the State of New York faces are no different than other states across the country; yet, New York continues to over spend and goes so far as to ask local municipalities to shoulder much of the financial burden from those decisions. Local representatives at the state and federal level are desperately trying to change the business climate in New York by offering tax credits and incentive packages for relocating businesses to New York, creating jobs, and improving the skill level of employees. As an advocate for the free market approach to business, I applaud the intent underpinning these programs (the encouragement of business activity in New York state), but I am apprehensive about the precedent and disparate treatment the tax credits and incentives are creating.
Incentivizing businesses to relocate or expand in New York is necessary for job growth, for improving our quality of life, and for expanding the tax base. However, I am concerned that the approach continually chosen by State and Federal leaders is to create tax incentives, credits and programs that result in government essentially picking winners and losers by allowing some businesses to receive tax incentives and benefits, while denying such benefits to others. If property taxes, income taxes, payroll taxes, unemployment insurance taxes, franchise taxes, corporation taxes and the myriad other taxes that are imposed upon the businesses and residents of New York State were all lower — across the board — there would be no need for tax breaks for “new” companies or companies specializing in certain types of products, and all companies, new and existing, would reap the same benefit. Unfortunately, the existing tax incentive proposals do nothing to reward existing businesses that fail to meet the arbitrary parameters set by these government programs, and by extension, existing companies end up subsidizing their competitors and suffering a competitive disadvantage. While certain new and expanded businesses (and their employees), will benefit from not having to pay income taxes, corporate taxes, property taxes, sales taxes, or franchise taxes and fees — the other businesses around them and the tax-paying residents of this State, will be paying hundreds of thousands, if not millions, of dollars in extra taxes in order to offset these forgiven taxes.