In New York, millionaires are asked to raise their taxes

On Tuesday at a federal budget hearing, millionaire Morris Pearl came to the Capitol and asked a bipartisan group of half a dozen lawmakers to create a new “multi-millionaire tax” that would cover families with more than 5 million dollars a year to finance new affordable housing, infrastructure and schools . This edition writes New York Times.

Millionaire Morris Pearl, former head of BlackRock, is chairman of the Patriotic Millionaires, a group that raises business and ultra-rich taxes.

Of more than 200 patriotic millionaires, 41 lives in New York State, which is famous not only for its high standard of living, but also for its high taxes.

Their request to create a new tax comes at a crucial moment, when the Democrats for the first time in a decade control state legislature.

Several lawmakers, as well as city council speaker Corey Johnson, last week expressed their support for the so-called income tax on expensive homes of wealthy people after a billionaire hedge fund bought a penthouse for 238 million dollars near Central Park.

The idea was supported not only by billionaires of the State of New York. Member of the United States House of Representatives Alexandria Ocasio-Cortes recently popularized the idea of ​​income taxation for those who earn over 10 million dollars. And Senator Elizabeth Warren from Massachusetts, who is running for president, promises to fight income inequality.

But not everyone wants to part with their money. In particular, Governor Andrew Cuomo did not support the idea of ​​a tax for millionaires, despite the fact that he predicted a state budget deficit of 2 billions of dollars.

According to the Washington-based Institute of Economic Policy, only one percent of wealthy New Yorkers control about 31% of state income. Cuomo said they also account for half of state income taxes.

"You have to consider this point where people say, 'I love New York, but if I have to spend another $300 in taxes, I'll move to Florida,'" the governor said in a radio interview last week.

Andrea Stewart Cousins ​​of Westchester, the leader of the Democratic majority in the state Senate, also did not support the idea of ​​new taxes.

Nevertheless, activists have argued for years that higher taxes on the rich will not harm the economy.

“New York will always be New York. There is no place like this anymore, and that is why so many millionaires are here,” said Abigail Disney, great-niece of Walt Disney and a member of the Patriotic Millionaires.

The existing state tax, dubbed the millionaire tax, affected people earning more than 300 000 dollars, and was introduced in the 2009 year.

Meanwhile, in 2016, the number of millionaires taxed in New York increased by 72 percent, and the total income of these millionaires increased by 54 percent during this time, according to the Institute for Fiscal Policy. Non-millionaire revenues increased by 33 percent over the same period.

“The taxes we're talking about won't affect the quality of life of rich people,” said Ms. Disney, who lives in New York. “They won’t have fewer private jets or boats because of this tax.”

In addition to creating a tax on billionaires, which, according to the group, will help to additionally collect 3 billion a year into the budget, millionaires want to close a loophole with interest rates that allows hedge fund managers to pay a much lower federal tax rate on most of their income.

Mrs. Disney and Mr. Pearl said they would also support real estate taxes, for example, on a penthouse in Central Park worth 238 million dollars, bought by Kenneth Griffin, although the group did not take an official position.

"If people like Mr. Griffin, who bought a $200 million apartment in Manhattan, paid more in taxes, some of those millions of dollars could benefit upstate schools," Pearl told lawmakers.

Cuomo has backed the idea of ​​closing interest rate loopholes, and aides have said he would consider a new tax. However, he openly ridiculed calls for a new millionaire tax - especially in light of new federal tax lawswhich Republicans adopted in 2017 year.

Neither Mrs. Disney nor Pearl have denied that the federal tax changes have cost them more - but in part, they say, they don't know if that's the case.

“I'm not exactly sure, to be honest,” Pearl said, adding that most of his income comes from capital gains, which are taxed at lower rates than ordinary income. “I pay much lower taxes than people who earn a living,” he continued, “But I don’t worry too much about it.”

Recall that after the tax reform a number of companies in the United States promised employees additional bonuses.

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