A pledge to not increase New York's personal income tax this year by Gov. Kathy Hochul signaled an early start to a broader debate coming in the state budget.
Hochul in her State of the State address on Tuesday said another increase in the income tax, the primary driver of revenue for New York's state government, shouldn't be included in a budget ahead of a potential recession.
"The majority of economists are predicting a recession," she said. "It's one of the reasons why it's clear to me we will not be raising income taxes this year."
Hochul's stance comes as New York has been flush with cash from federal pandemic aid as well as from previous increases in taxes on the richest residents, which has translated to a record increase in direct aid to schools.
A group of eight progressive lawmakers in the state Senate and Assembly rebuked the no-tax pledge for this year, however, as they called for new revenue to help bolster those affected by the pandemic.
"As a unified movement of legislators, representing over a million constituents who have grown weary of ineffective solutions, we are prepared to push back against the shortcomings of Hochul’s uninspiring plan with bold solutions that address the crises faced by working class New Yorkers," said the lawmakers. "We need transformative change for people who are denied a dignified life by our current economic system.”
Signing on to the statement: Sens. Julia Salazar, Jabari Brisport and Kristen Gonzalez, alongside Assembly Members Zohran Mamdani, Phara Souffrant Forrest, Marcela Mitaynes, Emily Gallagher and Sarahana Shrestha.
Budget observers, however, called the decision to oppose tax increases by Hochul potentially foresighted while also noting the state's nation-leading out-migration.
"Fortunately, Governor Hochul highlighted the need to stem outmigration," said Andrew Rein, the president of the Citizens Budget Commission. "She wisely committed to not raising the personal income tax this year. New York’s competitiveness will be well served by restraining spending to ensure that the 2021 personal income tax increase sunsets on schedule."