This year, on April 1, the state Legislature delivered its fourth on-time budget in a row. This state budget shows a demonstrated desire to take steps to improve the business climate, and thus investment, in New York state.
A top priority of the Fulton Montgomery Regional Chamber of Commerce is to work toward, and advocate for, lower taxes and a sensible regulatory climate for business, regionally and statewide. The final version of this new budget took steps to level the playing field for businesses in New York by providing $600 million in annual tax relief and reforms, while at the same time keeping state spending increases under 2 percent.
Although the final outcome did not address all of the issues for which the chamber advocated, overall it is a budget that demonstrates that the state is going down the right path in terms of creating a better business climate and making New York more competitive with other states when it comes to business investment. This new budget establishes a 20 percent real property tax credit for New York state manufacturers who lease or own property here. Originally intended to apply only to upstate businesses, the final budget allowed for inclusion of all manufacturers in the state - both upstate and downstate.
Also this year, the tax rate on income from all manufacturers goes to zero from its current rate of 5.9 percent, and the general business tax rate will be reduced to 6.5 percent from 7.1 percent, the lowest rate in over 40 years. Also, this year's budget increases the estate tax threshold from $1 million to $5.25 million, which will make it much easier to allow small-business owners to pass down their businesses to their children.
Of the three issues in which the chamber took a particular interest - the 18-a energy surcharge, acceleration of the minimum wage and scaffold law reform - we are happy to say that the budget addressed, positively, two out of these three issues. First, the 18-a assessment. Although not called a tax, this regressive energy surcharge has cost our member businesses hundreds of thousands of dollars annually and your chamber advocated strongly for its elimination. I am happy to say that reductions of this burdensome surcharge will begin this year, going from 2 percent to 1.63 percent, to 1 percent in 2015 and finally to 0.73 percent in 2016. These reductions are projected to save utility consumers $600 million over the next three years.
As for the move to accelerate the minimum wage from the original three-year, gradual increases to a full implementation of $10 per hour on Dec. 31, 2014, we are glad to see that no action was taken. This sudden increase would have been devastating to many of our small businesses that had budgeted for a methodized increase.
Unfortunately, there was no move to reform the Scaffold Law. This antiquated, costly law has a negative impact on every New Yorker and your Chamber will continue to push for reform.
All in all, this 2015 fiscal-year budget does a great deal to improve the potential for a revival of our state's economy and enhancing our efforts for economic development, but there is still much more that needs to be done.
Your chamber, through its Governmental Affairs/Advocacy Committee, continues to monitor business issues and voice our concerns to our elected officials.
If you have any concerns, or would like to become involved with the Chamber in fulfilling its mission, of being the leading voice of business in the region providing advocacy, resources and solutions for our members, please call us at 725-0641 or email email@example.com.