Tuesday, April 2, 2013

New York State 2013 budget minimum wage tax subsidy

TOM PRECIOUS 4/2/2013:
The state’s cost to give a $350 tax break to some middle-class taxpayers and to cover part of the higher payroll costs for businesses under the new minimum wage hike program will be more than the amount predicted last week by state officials.
The $350 tax break – in the form of checks to be delivered to a million or so taxpayers just before the November 2014 election – is now projected to cost the state $410 million.
That is up from the $350 million to $375 million officials estimated a week ago.
That tax break will go to households with at least one dependent child and adjusted gross incomes between $40,000 and $300,000.
The state-funded minimum wage subsidy will go to businesses to cover the difference when the minimum wage goes from $7.25 to $8 per hour in January.
The 75 cents per hour subsidy will cover the costs for businesses that employ 16- to 19-year-olds who are students, though the budget bill does not define “student.”
When the wage is raised to $9 in January 2016, the state will pay businesses $1.35 per hour per employee for every one of those eligible workers.
The minimum wage tax subsidy was to cost about the state $45 million per year.
New numbers from the Cuomo administration now show the subsidy will cost $35 million in the 2015 tax year and then average $65 million in each of the following three years.