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Moving toward a payroll mobility tax repeal

by Benjamin Kabak

Some news from Long Island: State Senator Lee M. Zeldin, one of a group of Republican representatives from outside of the city, is thrilled to announce that a recent Senate Budget Resolution is an “important first step” on the road to a repeal of the payroll mobility tax. The resolution, which will still need to get through the Assembly and past Gov. Andrew Cuomo’s desk, ends the tax on public and private school. It is, said Zeldin, “the first steps in my efforts to completely eliminate this job killing tax. Exempting schools also removes a school district operating cost, which is paid for by property taxes.”

In addition to this new exemption, the resolution would demand the MTA submit to a full-scale forensic audit within 60 days of its enactment. Allegedly, the audit will find “hundreds of millions more in savings that can be used to support complete repeal of the MTA payroll tax for every employer in the MTA Region.” The MTA, of course, has long embraced a forensic audit, and if such an examination reveals that much savings, it would be a welcome development.

Ultimately, this road to repeal can be a dangerous one for New York and the MTA. As Jay Walder said a few weeks ago, “It would be impossible for the MTA to replace $1.4 billion.” Zeldin and those who support repeal have their constituent interests in mind, but the money is going to have to come from somewhere lest our transit network and regional economy suffer the consequences.

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21 comments

Avi March 16, 2011 - 12:15 pm

If this repeal happens, I hope the MTA raises LIRR/MNR fares and not NYCT fares. You know, make the constituents of the people complaining about the tax pay for the lost revenue.

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Lawrence Velázquez March 16, 2011 - 12:21 pm

Agreed. It would be only fair.

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Bolwerk March 16, 2011 - 12:19 pm

Actually, the payroll tax should be repealed in New York City. Let the suburbanites foot the bill!

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E. Aron March 16, 2011 - 12:39 pm

My father runs a practice in Manhattan and was hit with this tax. It amounted to roughly $300 last year. I assure you, he at least did not lay anyone off or reconsider hiring any new employees based on $300.

The Republican party has generally been able to spin many things as “job killing” in this state and others and on the national scene. When will people start to look into those clearly erroneous claims and call them out for their political posturing?

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Christopher March 16, 2011 - 12:42 pm

He does NOT have his constituents in mind. If he did, he wouldn’t kill taxes that support the very infrastructure needed for his constituents to get to work. I also assume that at least some of his constituents include MTA employees who could lose their jobs over lost revenue.

Oh but that’s right, public employees don’t counts as employees.

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Jeff March 16, 2011 - 12:52 pm

“public employees don’t count as employees.”

That pretty much sums up the austerity debates sweeping the nation. Every single disinvestment in the public sector, including the laying off of public employees, is somehow spinned as “promoting jobs.”

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Billy G March 16, 2011 - 12:43 pm

The payroll tax should be rolled back everywhere.

It’s utterly unfair to those who chose an alternate mode of transport, don’t give me the BS about reducing traffic.

Increasing the intake in the farebox is the only fair thing to do. A large number of the suburbanites only use a very small part of the subway system. Fare zones that favor short distance rides but perhaps have a peak zone in the central core. This would also make riders coming in from the outer boroughs going to jobs in the central core pay their fair share.

Yes, increase fares on MNR and LIRR if need-be, but make them pay THEIR operating and infrastructure costs, not subsidize and socialize the operating and infrastructure costs of outer borough riders.

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SEAN March 16, 2011 - 12:47 pm

Moron!

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Jonathan R March 16, 2011 - 1:01 pm

With no LIRR, how would Long Islanders get to the high-paying jobs in Manhattan? They would drive. If I-495 was clogged up with Manhattan-bound traffic, how would local workers in Nassau and Suffolk get to their jobs?

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al March 16, 2011 - 1:44 pm

“Yes, increase fares on MNR and LIRR if need-be, but make them pay THEIR operating and infrastructure costs, not subsidize and socialize the operating and infrastructure costs of outer borough riders.”

Well that roughly means doubling Metro North fares, and quadrupling LIRR ticket prices. Thats just cover operating costs, not capital.

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Bolwerk March 16, 2011 - 3:34 pm

Regardless of how many use it, suburbanites don’t subsidize the subway system and they probably never did. They should, however, pay for the shortfall for at least the proportion of the commuter rail system that is outside of the city.

Unless you’re planning on de-“subsidize and socialize”-ing roads, I don’t expect your no-subsidies scheme would be very workable.

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Alon Levy March 16, 2011 - 8:42 pm

On the contrary – per mile, i.e. more or less per unit of operating cost, longer-distance riders pay much less. A 35-mile trip from Stamford to GCT is $12.50 peak; a 12.6-mile trip from Wakefield to GCT is $7.50. In other words, outer borough riders are paying nearly twice as much per mile as suburbanites.

Now, bear in mind, those trains are subsidized. Since operating costs are proportional to distance and fares aren’t, what this means is that suburbanites are getting higher subsidies per passenger-mile, which then works out to getting several times the subsidy per person.

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R. Graham March 16, 2011 - 11:16 pm

So basically if it we’re up to you, raise the fare box to match the cost of driving your personal vehicle into town right? There are so many people who are smarter than taking the subway to work everyday to offset the costs of driving the vehicle downtown instead. So basically my incentive to avoid traffic, you sir would like to strip away from me.

What you call BS is what I call saving a substantial portion of my income needed to feed my kids year to year. If you’re rich then pay the tax! And then on top of that they should still add a commuter tax and congestion pricing and the funds should not only go towards subsidizing the MTA but they should also go towards outpatient treatment for all individuals suffering from asthma in areas like East Harlem and the South Bronx. Just because you and thousands more like you feel like cramming narrow roadways in hours of traffic in these areas shouldn’t mean the people have to suffer so pay up buddy! Or the next time someone mentions anything about highway expansion how about you be the first in line to recommend your neighborhood for a six lane highway?

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Al D March 16, 2011 - 1:40 pm

Him?

http://leezeldin.com/

1. Repeal Payroll Tax without alternative funding mechanism included as part of the repeal: Dumb
2. Initiate a Forensic Audit even though DiNapoli already has about 174 MTA audits in process (some of which are no doubt ‘forensic’), and Walder continues to find efficiencies without the help of and maybe even in spite of Albany: Dumb

Job Killing, hahaha

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Skip Skipson March 16, 2011 - 1:59 pm

I have heard about this “conduct a forensic audit of the MTA” for the past 10 years. Do politicians actually follow through with these ‘forensic’ audits? You would think that the MTA would be a profitable organization now due to these continued ‘forensic’ audits.

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Donald March 16, 2011 - 2:41 pm

Can’t Republicans ever say a sentence that does not include the words “Job killing tax”? It’s an old and tiered talking point sent down to them from their corporate masters in D.C.

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Donald March 16, 2011 - 2:50 pm

I just read the article and the repeal bill only applies to public and private schools. Even if the bill passes, companies would still be subjected to the payroll tax.

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Alon Levy March 16, 2011 - 8:43 pm

The bill’s author explicitly condones this as a salami tactic.

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Josh K March 17, 2011 - 10:07 am

Maybe their plan is that the income tax revenue generated by the hiring of all these forensic accountants, performing overlapping forensic audits will make up for the lost revenue from the payroll tax? Then, with all of the office space that will be needed, it will somehow magically spur a new construction boom in the city, bringing in new real estate transaction tax revenue!

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Streetsblog New York City » Assembly and Senate Would Strip Another $170M From Transit Riders March 24, 2011 - 11:41 am

[…] Republicans’ budget, which passed that house last week, contains that conference’s first steps toward repealing the payroll mobility tax. It exempts both public and private schools from paying the payroll tax, […]

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An anti-payroll tax website but no better ideas :: Second Ave. Sagas June 1, 2011 - 3:36 pm

[…] the Third District on Long Island by campaigning on the issue and has spent a lot of time working toward a repeal. Despite the fact that the state GOP may wait until 2012 to throw its weight behind a repeal, […]

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