Concern over New York City’s future is brewing as state lawmakers take into account drastic measures that would hinder the metropolis’s recovery from the Covid-19 pandemic.
New York Governor Andrew Cuomo proposed in January elevating taxes on the rich and chopping Medicaid and faculty spending at the state stage. Conservatives argue that greater taxes may lead to rich taxpayers leaving the metropolis, whereas progressives say decreasing providers may have a long-lasting affect on New York City.
New York City is very depending on its rich inhabitants. In 2018, the prime 1% of earners made up 42.5% of whole revenue tax collected by the metropolis, in accordance to the Independent Budget Office of New York City. That was $5 billion in income for the metropolis.
“If they leave, there’s a huge fiscal crisis,” stated Jared Walczak, vp of state tasks with the Center for State Tax Policy at the Tax Foundation. “How do you pay for all of these services? That affects everyone. The people who stay either have a higher tax burden or will receive fewer government services.”
“There’s a real question that policymakers need to address right now. How do you keep these people here? How do you make sure that post pandemic, they want to come back?” Walczak stated.
But Kim Phillips-Fein, a historian at New York University, stated cuts to providers may damage the metropolis in the long term. She famous austerity measures taken throughout the 1970s fiscal disaster brought on growing inequalities which have haunted the metropolis ever since.
Cornell University assistant professor Cristobal Young additionally identified that solely a small fraction of rich individuals depart their states for tax functions.
Watch the video above for extra on New York’s state of affairs and its potential road to recovery.