Albany (June 20, 2014) – The state’s leading advocate for small business owners, representing more than 10,000 members, today said the legislative session that came to an end today in Albany didn’t cause much damage to the economy but didn’t improve much either.
“The main beneficiaries this year of the tax initiatives this year are big corporations,” said National Federation of Independent Business (NFIB) State Director Mike Durant. “But small businesses in New York didn’t gain much from this session.”
Governor Cuomo and lawmakers this year pushed through some tax reforms that provide targeted relief for manufacturers and larger corporations. But they took a pass on other reforms that are much more important to small businesses.
“For years we’ve been calling for mandate relief that would get to the heart of New York’s worst-in-the-country property tax problem,” said Durant. “The property tax is the biggest tax burden for many small businesses and we regret that Albany did nothing this year to address that issue.”
Also missing from the agenda, said Durant, was an effort to reform the state’s Scaffold Law, which makes contractors liable for workplace accidents even when the employees are at fault.
“We’re the only state in the country with that law and it puts a target on the backs of construction companies and contractors who are routinely dragged into court and made to pay very high damage awards even when they’re not responsible,” he said. “It’s a big disincentive for small businesses and it drives up costs for taxpayers because it inflates the cost of every public capital project.”
One bright spot for small business owners is an increase in the Estate Tax Exemption, which makes it easier for farmers and small business owners to pass their businesses to their heirs without government scooping up a big percentage of the assets.
But New York’s income tax remains among the highest in the country. That hurts small business owners especially since they generally file as individuals, not corporations.
“Most people don’t realize that two thirds of small business owners pay the income tax, not the corporate tax. So the income tax is really a tax on small businesses,” said Durant. “As long as we have one of the highest income taxes in the country we’ll be a tough place for entrepreneurs to start, operate or expand a business.”
Durant said that while small business owners are disappointed in the lack of progress this year they are hopeful that state leaders will address some of their issues when they return in the fall.
“New York ranks at or near the bottom of every business survey because it has failed for decades to address these issues,” he said. “We can’t be competitive as long as these problems remain and they need to be the Legislature’s top priorities when they return.”
For more information about NFIB, please log on to www.nfib.com.