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Thread: Cuomo's 'Tax-Free' Plan for NY Is Not So Tax-Free

  1. #1
    Member Mr. Lackawanna's Avatar
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    Cuomo's 'Tax-Free' Plan for NY Is Not So Tax-Free

    Source Newsmax


    New York, rated the worst state in which to set up a business, is trying to lure entrepreneurs with a seductive new TV commercial that promises: "Move here ... And pay no taxes for 10 years."

    The campaign is the brainchild of Democratic Gov. Andrew Cuomo, who is up for re-election this year and is mentioned as a possible presidential candidate in 2016.

    But critics say the devil is in the details: the plan, which is centered on the creation of tax-free zones, contains many regulations and exceptions that will make it hard to work as promised.

    "Don't expect these zones to achieve much," said Iain Murray, vice president for strategy and a financial and trade expert at the Competitive Enterprise Institute in Washington.

    "There will be some businesses for whom margins are tight enough to allow them to start up with the tax relief rather than without it, but nowhere near the number if the government really did get out of the way and allow real regulatory relief for them," Murray told Newsmax.

    The tax-free zone plan, called Start-Up NY, pledges a 10-year exemption from property, sales, and state income taxes for people starting or expanding a business in New York. Cuomo sees it as a way to generate increased business revenue for the state.

    The program has been heavily touted in slick national TV commercials:

    "The new New York is open. Open to innovation. Open to ambition. Open to bold ideas. That's why New York has a new plan. Dozens of tax-free zones all across the state. Move here, expand here or start a new business here, and pay no taxes for 10 years. We're in New York. If there's something that creates more jobs and grows more businesses, we're open to it."

    The program doesn't actually guarantee 100 percent tax-free status and it only applies to a specific segment of the business world. In other words, it's a lot more complicated than 30-second media spots put forth, says a lawyer who has dissected the program.

    "This is a complicated program with extensive regulations and guidelines," Kevin McAuliffe, a partner in the law firm of Hiscock & Barclay, was quoted as saying on Syracuse.com. "The benefits can be lucrative, but they will not necessarily eliminate all tax liability."

    Start-up NY applies only to new or certain expanding businesses that are willing to partner with universities in the state and locate near their campuses.

    Some businesses are exempt from the plan, including retailers, hotels, medical providers, and law offices.

    The goal is to entice high-tech companies, especially those locating in areas that are home to one of the State University of New York's 64 campuses. But not all high-tech or other welcome companies will receive full tax-exempt status.

    Only those businesses "with 100 percent of their operations ... In a tax-free area" would receive a zero tax liability, Start-Up NY said. "For businesses with operations in and out of a tax-free area, the credit would be pro-rated based on the percentage of assets and payroll within a tax-free area."

    That could exclude from a tax-free haven high-tech business that sell products online or over the phone to sources outside the zones.

    "Enactment of enterprise zones is certainly preferable to the status quo in high-tax states," Patrick Gleason, director of state affairs for Americans for Tax Reform, told Newsmax. "However, a more advantageous and economically sound approach is broad-based tax relief for all, regardless of geographic location."

    The regulations for Start-Up NY participation could prove dizzying.

    Start-up NY participating businesses have to pay other taxes and fees, depending on the outcome of a regulatory certification process that determines, among other factors, how much of the business activity takes place within the zone, versus outside the boundaries and how those outside-zone transactions should be valued.

    Until properly certified, the businesses pay, in whole or part, organization tax and license and maintenance fees, a metropolitan commuter transportation district mobility tax, and a sales and use tax.

    Start-up NY also promises that "employees will pay no state or local personal income taxes."

    But the positions and employees have to first receive a government stamp of approval that the jobs are entitled to the tax break another certification process.

    Start-Up NY business employees aren't necessarily in the free and clear for taxes for the full 10 years.

    The rule is that they "pay no state or local income taxes for the first five years," but for the second five years, income limits kick in to determine the tax responsibility for each worker. In general, workers earning more than $200,000 a year start to pay taxes after the fifth year of operation.

    On top of that, the business can have only a certain number of workers eligible for the tax-free benefit.

    "There is an annual cap per business on the number of employees that qualify for this exemption and an annual cap statewide of 10,000 net new jobs," the Start-Up NY site says.

    Murray said previous attempts to set up economic zones didn't always work as planned.

    "These zones appear to be the latest in a series of variations on President [Ronald] Reagan's enterprise zones, which had some success in the 1980s. Unfortunately, and this was the case with Reagan's version, too, they don't really go far enough to foster a real free-market revival," Murray said.

    "Tax is just one element of the business calculation," he said. "A real enterprise zone would be much more like the Free Cities project being undertaken in Honduras, where four separate freedoms are guaranteed: legal, economic, administrative, political. In other words, the businesses in these new communities are freed from the pile of constraints that go well beyond tax.

    "If tax relief is such a good idea for these areas, why isn't it a good idea for the state as a whole? Or the nation? The whole country needs to become an enterprise zone," Murray said.

    The nonprofit Tax Foundation just released its list of best and worst states in the nation to conduct business, and New York came in dead last at No. 50.

    "The states in the bottom 10 suffer from the same afflictions: complex, non-neutral taxes with comparatively high rates," the Tax Foundation reported in its 2014 State Business Tax Climate Index, which bases its ratings on corporate taxes, individual taxes, sales tax, unemployment insurance tax, and property tax.

    Meanwhile, the state's largest city, under the leadership of New York City's new Democratic Mayor Bill de Blasio, is rapidly moving in the opposite direction: toward a less free-market atmosphere, more government intervention, and a populist rhetoric that targets the rich.

    De Blasio's policies could well drive out the wealthy including big businesses from the city with his vow to tax the richest residents to fund government programs like prekindergarten for all children, and his claim that voters gave him a clear mandate to target the rich for more taxes when they elected him in November.


    In regards to New York City, the wealthy citizens of New York make the decisions on where their businesses are located and where they will live and pay their taxes. They just might move out of New York and pay their taxes somewhere else!
    Russia didn't make me vote for Trump, Hillary did.

  2. #2
    Tony Fracasso - Admin
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    "The new New York is open. Open to innovation. Open to ambition. Open to bold ideas. That's why New York has a new plan. Dozens of tax-free zones all across the state. Move here, expand here or start a new business here, and pay no taxes for 10 years. We're in New York. If there's something that creates more jobs and grows more businesses, we're open to it."

    The program doesn't actually guarantee 100 percent tax-free status — and it only applies to a specific segment of the business world. In other words, it's a lot more complicated than 30-second media spots put forth, says a lawyer who has dissected the program.
    Here is an idea. The New York State Democratic Party (including county/local town democratic parties) pack up and take their ideas/spending habits to another part of the country. It would be a win win for New York State business owners and home owners.

    Just look at the population loss in Cheektowaga NY and other towns controlled by this political party. Let them work their miracles in other states and let those people flee back to New York State. If the idea is carried throughout New York State families may move back to their love ones. Families that were broken apart because of the lack of jobs and high taxation may be reunited once again.


    The goal is to entice high-tech companies, especially those locating in areas that are home to one of the State University of New York's 64 campuses. But not all high-tech or other welcome companies will receive full tax-exempt status.
    See how it works? Steer companies to politically connected developers who purchased areas where these "tax free" zones are created. Possibly pulling businesses from other parts of New York State leaving leaving those properties empty.



    "Enactment of enterprise zones is certainly preferable to the status quo in high-tax states," Patrick Gleason, director of state affairs for Americans for Tax Reform, told Newsmax. "However, a more advantageous and economically sound approach is broad-based tax relief for all, regardless of geographic location."
    Boy does he have that right. I say start at the bottom. We make a list of all elected officials (county,town boards, city) that are card carrying members of the Erie County Democratic party. Carry this idea with all the counties in NYS. If they whine that they don't agree with the democratic agenda their only choice will be to join another political party.

  3. #3
    Member Mr. Lackawanna's Avatar
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    Democrats have found the key to success

    Quote Originally Posted by WNYresident View Post
    Here is an idea. The New York State Democratic Party (including county/local town democratic parties) pack up and take their ideas/spending habits to another part of the country. It would be a win win for New York State business owners and home owners.

    Just look at the population loss in Cheektowaga NY and other towns controlled by this political party. Let them work their miracles in other states and let those people flee back to New York State. If the idea is carried throughout New York State families may move back to their love ones. Families that were broken apart because of the lack of jobs and high taxation may be reunited once again.

    See how it works? Steer companies to politically connected developers who purchased areas where these "tax free" zones are created. Possibly pulling businesses from other parts of New York State leaving leaving those properties empty.

    Boy does he have that right. I say start at the bottom. We make a list of all elected officials (county,town boards, city) that are card carrying members of the Erie County Democratic party. Carry this idea with all the counties in NYS. If they whine that they don't agree with the democratic agenda their only choice will be to join another political party.
    I like your idea of starting at the bottom, but I don't know if it will work.
    Over many years of voting and watching how elections are won or lost. It seems to me it is not the best politicians who get elected. It is the politicians who promise the most free gifts to the voting public. These gifts can be in the form of sweetheart labor contracts to the unions, increase in monies to the School Boards and more money for the welfare class. All these gifts can be called entitlements which the Democratic party loves.
    To sum it up in my view the Democrats support of entitlements is the reason they are so successful as a party.
    Russia didn't make me vote for Trump, Hillary did.

  4. #4
    Member nogods's Avatar
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    "There will be some businesses for whom margins are tight enough to allow them to start up with the tax relief rather than without it, but nowhere near the number if the government really did get out of the way and allow real regulatory relief for them," Murray told Newsmax.
    Most people see a big difference between tax relief and regulatory relief. which did he mean?

    I have no doubt that if all the environmental regulatory provisions were eliminated, we'd have 100's of Tonawanda Coke's starting up or moving to NY, bring jobs along with the poisoned air.

  5. #5
    Tony Fracasso - Admin
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    It would work. You just have to have the correct people behind it. Having "lawyers" as party chairmen is not what you want. They are just lawyers not people who market a product for the most part. You need lawyers to make sure laws are followed.

    Point out the misleading campaign literature to property owners from the democratic party. We have loads of examples. Have every elected democrat official own what Cuomo/Obama put into law. Anti-second amendment, the spending burdens placed on us property owners, the intolerance towards people who are prolife, and the list goes on. Take YouTube for example. When a local democratic elected official boast about what they do have a counter video to expose the truth.

    Here is a quick example that comes to mind.

    Cheekman
    Last week Friday was the last day for Val Meyers the wife of new board member tim Meyers reasons not needed any longer and family member can not work in the town.. that's BS so the town is saving about 51 grand in sal. plus all her bennies. holtz said its part of downsizing town employees to save money.

    Now at Mondays town board meeting the board appoints an new asst police chief a position that has been vacant for almost 20 years.. its was vacant years ago because the town felt no need for this position and saved the pay and bennies...CPD wants to congratulate James Speyer in his promotion from Captain to Assistant Chief. no doubt politics were involved with this move..
    This was went to me Jan 31st

    Appointment of Assistant Police Chief
    (Competitive/Permanent)/James J. Speyer Jr.
    Sponsored By:
    Councilmember Kaminski, Supervisor Holtz
    WHEREAS, a vacancy exists in the title of Assistant Police Chief in the Police
    Department; AND
    WHEREAS, said job title is in the competitive class of civil service; AND
    WHEREAS, an interview was conducted and work performance reviews studied; AND
    WHEREAS, James J. Speyer, Jr., currently employed as a Police Captain in the Police
    Department, appears on the existing civil service list and meets the necessary qualifications for
    appointment; NOW, THEREFORE, BE IT
    RESOLVED, that Police Captain James J. Speyer, Jr., of Depew, New York, be and
    hereby is appointed to the position of Assistant Police Chief in the Police Department at the
    annual rate of $111,000 effective February 4, 2014
    All you will hear is how the town downsized saving $51,000+ but you won't hear that a position was re-instated at $111,000 plus Health Care Costs and bene's.

    We didn't downsize, we up-sized.

    Added $111,000 plus insurance/bene's - $51,000 plus insurance/bene's = We are spending more today than before.

    See what I did? I left out one detail. I wonder what the salary as a Captain is versus an Assistant Chief.


    The democratic party uses our money to buy their votes. NOW you are starting to see the republicans pander to groups. Notice some republicans are now talking amnesty for people who are here illegally?

    Point the truth out and let the democratic party move out of our state instead of families and businesses.

  6. #6
    Member NY The Vampire State's Avatar
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    Oh you mean the sheep have been mislead again? The deception should really be no surprise anymore. When any of the parasites open their mouths we are being deceived. This tax free zone (along with IDA's) is a violation of the 14th amendment. Period.

    Of course there will be some austere stipulations to Cuomo's plan. How else will we give this to the politically connected, while weeding out the other fools who apply and not make it look "OBVIOUS"?
    Democrats & Republicans Suck Alike.

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