New York State Senate Republicans will pass their own wish-list for a state budget early next week that will include a series of business tax breaks designed to prod the state's moribund economy.
The plan includes several old and new ideas for job creation efforts, including a 20 percent tax cut affecting about 200,000 small businesses in the state. The tax break would cost $65 million, and take the current 6.85 percent state tax rate to 5.5 percent.
The proposal comes as both houses on Monday are expected to begin passing their own versions of a 2012 budget, a process that would then begin a public conference committee process to iron out differences.
The separate budget plans permit the two houses, especially in an election year, to reach out to their core constituency groups.
In the case of the Senate Republicans, who are working to keep control of the chamber in the November elections, that means a focus on business tax breaks and job creation incentives.
The Senate GOP plan also will provide a 10 percent tax credit for 800,000 small businesses that pay their state taxes through personal income taxes. The pricetag on the credit is $120 million. The tax credit would be available to businesses with at least one worker and business income under $250,000 annually.
For families with children in college, the Senate Republican plan calls for increasing the current tax deduction from $10,000 to $13,820 -- with the maximum credit going from $400 to $553. The tax credits and deductions would also rise each year based on an annual college cost index.
Businesses would also get a tax credit of up to $5,000 for each new job created, going to $8,000 if the person hired has been unemployed.
The Senate GOP plan does not specifically say how all the tax breaks and credits would be financed, though the senators are calling for a 2 percent cap on the annual growth in state spending and a moratorium on new taxes or fees. The Senate, Assembly and Gov. Andrew Cuomo enacted a large tax hike in December on millionaires.
Utility bills for consumers would be targeted by phasing out a 2009 hike; the utility increase would be rolled back in 2013 instead of the planned expiration in 2014.
A constitutional amendment is also being proposed requiring a two-thirds vote by the Legislature for any tax increase, a longtime dead-on-arrival idea, at least in the Assembly. The Senate GOP plan includes a new mandate on state agencies to be more responsive to small businesses in permitting processes. The measure would require agencies to publicly disclose their response times to permit requests and to provide refunds to applicants if their permit request takes longer than 134 percent of the average processing period.
The major budget battles -- how much to spend on health care and education, the largest parts of the budget -- have already been settled between Cuomo and the Legislature. On education, though, the sides are still debating how much of the overall pot to add to the operating aid the state provides to 700 public school districts.
Lawmakers insist they are on track to get an on-time budget before the April 1 fiscal year start.
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