Cuomo said New York needs at least $15 billion in federal funding to make up for the revenue losses incurred by the coronavirus pandemic, and said that if these needs aren’t met he will need to raise taxes from 8.82% to 10.86% — the highest income tax in the country.
The state would also have to cut funding for education, Medicaid, local governments, and social services, he said.
“What happened to New York was no fault of New Yorkers,” Cuomo said in his annual budget address this week. “It was because the federal government lost track of coronavirus, literally.”
Several fiscal watchdogs have disputed Cuomo’s narrative and argued New York’s economy is recovering from the pandemic far better than expected.
State comptroller Thomas DiNapoli recently predicted that New York will bring in nearly $4 billion more in tax revenues than expected through March.
This is one of the reasons former President Donald Trump was hesitant to send more federal funding to New York and other Democratic-controlled states.
“I don’t think the Republicans want to be in a position where they bail out states that are, that have been mismanaged over a long period of time,” Trump said early last year. “Florida is doing phenomenal, Texas is doing phenomenal, the Midwest is, you know, fantastic — very little debt. But you look at Illinois, you look at New York, look at California, you know, those three, there’s tremendous debt there, and many others.”
Several other Republicans agreed and slammed the idea that the federal government should bankroll New York’s fiscal mismanagement.
“It’s irresponsible and reckless to take money from American taxpayers and use it to save liberal politicians like Cuomo from the consequences of their poor choices,” Sen. Rick Scott, R-Fla., said at the time.
But now that Joe Biden is in the White House, it’s much more likely that Cuomo will get his way.
“The budget hole is so big that if we don’t get federal funding, you will have to increase taxes on the higher end, you’ll also have to cut services, you’ll also have to borrow and you’ll probably have to lay off. That’s the scale of this deficit,” Cuomo insisted.