Democratic lawmakers in the New York State Assembly are reportedly considering the idea of levying an extra 1 percent income tax on everyone with income over $1 million in order to balance the state's budget and help fund transportation costs, but the proposal is likely to run into opposition from the governor and the State Senate.
The New York Times reported that the proposal has the support of Assembly Speaker Sheldon Silver (pictured), but Governor Eliot Spitzer and State Senate Majority Leader Joseph Bruno have rejected any proposals to raise taxes. The plan would create a new tax bracket of 7.7 percent for all taxpayers with at least $1 million in income. They are currently taxed at a rate of 6.85 percent. If approved, the proposal could raise up to $1.5 billion in the first year.
In the first year, the money would go into New York State's general fund, according to the Times, while in the second year it would be split between the general fund and transportation projects such as a subway line being built along New York City's Second Avenue.
In the third, fourth and fifth years, the money would go entirely toward transportation projects. It is expected to reduce pressure on the Assembly to approve a controversial congestion-pricing plan that would charge drivers extra to drive into Manhattan below 60th Street between 6:00 am and 6:00 pm on weekdays.
