Middleburgh NY, April 11, 2012— Governor Andrew M. Cuomo ,center, is flanked by Ulster County Executive Mike Hein, left, and Middleburgh Town Supervisor James Buzon,right, Gov. Cuomo announced that New York State will cover the local share of disaster response and recovery costs resulting from Hurricane Irene and Tropical Storm Lee. The Federal Emergency Management Agency (FEMA) usually covers 75% of eligible disaster response and recovery costs, and the remaining 25% is typically shared equally by the state and localities. Under the Governor’s direction, the state will pick up the local share for most eligible expenses, making $61 million available to 25 counties to cover costs associated with emergency shelter, road, water system and infrastructure repair, stream and riverbed mitigation, and other clean-up projects. FEMA plays a vital role supporting State, Tribal and local governments as they respond to the impacts of Hurricane Irene. Hans Pennink/FEMA

New York Governor Andrew Cuomo (D) recently announced that his state is facing a $2.3 billion projected loss in revenue. While he may have been shocked by this figure, this trajectory should have been spotted when a new tax plan was signed into law in 2017.

Cuomo is pointing fingers at the tax plan rolled out by the Trump administration, blaming it for the loss in revenue. He even commented, “In New York estimated tax payments are $2.3 billion below forecast thanks to the politically-motivated assault on blue states through the federal tax code.”

His reasoning hinges on the fact that the wealthy have started to move to different states after the passage of a tax plan with a cap on SALT (state and local taxes) deductions, therefore leaving the state with less revenue to collect. To be sure, this deduction cap certainly had an impact on whether or not a person would continue to live in New York. However, if Cuomo wants to be angry with anyone about this, it should be himself.

If there is a limit on the SALT deduction available, why should a person with the means to easily move remain in a high tax state? According the Tax Foundation, a nonpartisan policy think tank, the state of New York has the highest tax burden in the country, with an average combined state and local tax of 12.7 percent, which equates to a collection per capita of $2,789.

Governor Cuomo, do you really think this is a problem with the new tax plan, or do you think it’s a problem with your own state? After all, the majority of these people are not renouncing their American citizenship – they’re simply moving to other states.

What Cuomo and so many others do not realize is that bad tax policies applied upon the wealthy simply serve to mobilize them. While the poor are highly immobile, as the cost of relocation is often out of reach, the rich have few barriers to mobility; if moving costs far less than staying, why stay?

New York’s projected revenue loss should serve as a reminder to all of us that bad or unequal tax policies are not the way of the future. Instead, fair taxation that encourages innovation and hard work must be sought after.

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