After New York City’s Metropolitan Transportation Authority (MTA) approved a budget authorizing a 5.5 percent fare increase to address chronic budget shortfalls, the state assembly flew into action coming up with ways to avoid that. New York’s latest tax scheme would attempt to pay for the MTA by hiking taxes on everyone from streaming services like Netflix to small delivery businesses to digital workers —basically, on everyone except the actual riders of public transportation.
Under its 2023 budget, the MTA is set to run a $600 million deficit, even after using nearly $1.8 billion in federal pandemic-related aid. Things will get even worse once that federal aid runs out—in 2025, the MTA is set to run a $3 billion deficit.
In place of fare increases, Gov. Kathy Hochul has now proposed an increase on the top payroll tax rate paid by employers: from 0.34 percent to 0.5 percent in New York City and surrounding counties served by MTA trains and buses. State legislators have countered with a hodgepodge of proposals, including a 2 percent increase on the top statewide corporate tax rate, applying state and local sales taxes to streaming services, and a new $0.25 “delivery fee” on delivery transactions within New York (with some exceptions).
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