Progressive Taxation & Fiscal Policy
Political democracy remains a distant promise without economic democracy. A principal instrument for achieving economic democracy is our tax system. Taxes are the means whereby we fund our public services. Public services are the avenues of private commerce. Business will not locate and thrive in the City of Syracuse without first-rate schools, safe streets, and fully-staffed police, fire, parks, codes, sanitation, and other departments for their businesses and their families. Poor schools and public services induce those who can afford it to flee the city.
In recent years, Syracuse has shut the Ida Benderson Senior Center and cut school teachers and programs year after year. The Parks and Recreation Department has a fraction of the staff it once had. Police and fire department staff have been cut and now fire stations are being closed. The constant refrain from Democratic and Republican leadership is, “There is no money. We must cut services.”
The claim that there is no money is a smokescreen that obscures the truth about what has transpired with state revenue over the past three decades. The richest 1 percent of households in New York State has more than tripled their share of all income statewide from 10 percent in 1980 to 35 percent in 2007; but taxes on the rich have been radically reduced and taxes on working people have been radically increased. Since the late 1970s, the top state income tax bracket on high incomes has been more than halved, while the bottom tax bracket on low incomes has been doubled. The state collects over $15 billion a year from the Stock Transfer Tax, yet since 1981 has rebated 100% of the revenues to the stock traders. The state Finance Law until recently promised the state will share 8% of its revenues with municipalities to pay for state spending mandates on local governments, but annually exempted itself from that law and provided revenue sharing of less than 2% of state revenues.
The combination of tax cuts for the rich and cuts in state revenue sharing has forced local governments to make up the difference with higher sales and property taxes. Sales and property taxes are regressive, which means they tax working and middle class people at higher rates than rich people. In 2013, the poorest 20% of households in New York (average income of $10,000) will pay 13.4% of their income in sales and property taxes. The middle 20% of households (average income of $44,700) will pay 8.8%. The richest 1% (average income of $2,235,600) will pay only 3.1%. The Greens call for reversing the rates paid by rich and poor through progressive tax reforms at the city and state levels.
To remedy this outrageously unjust tax system the Green Party calls for comprehensive tax reform that includes progressive taxation, taxing “ills” not “goods,” taxing unearned income at the same rate as earned income, taxing speculation on Wall Street, and cutting corporate tax giveaways. We can afford to cut taxes for most people if we make corporations and the super-rich pay their fair share. Then we can cut them even more when we halt our nation’s wasteful spending on wars, weaponry and militarism.
The Green Party proposals for progressive tax reform is not about “soaking the rich,” or taxing away their wealth. These proposals are about making the rich pay the taxes they used to pay in order to fund the city services and schools. If the rich in New York State paid the taxes they used to pay, and if the state shared the revenues they promised to, there would be no fiscal crisis in Syracuse or the scores of other cities, towns, and school districts now facing insolvency. Syracuse should be receiving that money and spending it on improving our schools, police and fire protection, and parks and recreation and investing in the infrastructure and businesses that can build a sustainable prosperity for our city.
Progressive Taxation & Fiscal Policy
6-1. Greater Utilization of NYS Progressive Income Tax through Revenue Sharing: The Green Party supports greater utilization of the progressive New York State income tax and revenue sharing to reduce reliance on property and sales taxes and assure adequate funding for the City of Syracuse and the Syracuse City School District and other municipalities and school districts. This is essential to provide revenue for necessary services, infrastructure maintenance and repair, development and maintenance of affordable housing options for low income and homeless individuals/families, and maintenance of parks and green spaces. Adoption of a New York State single payer, universal public health insurance program would reduce municipal and school district payroll costs by more than 30% (see section 8 for detailed items regarding state income tax and revenue sharing and controlling health care costs through a universal, single payer public health insurance program).
6-2. Adopt Long Term Budget Planning: The Green Party calls for the City to develop five-year budget projections and adopt annual budgets that fit within those five year plans. Long term budget planning facilitates decision-making on annual revenues and expenditures and early identification of fiscal problems.
6-3. Ensure Funds Appropriated by the Common Council are Used as Intended: The Green Party supports a change in the Charter for the City of Syracuse to remove the power of the Mayor to impound funds appropriated by the Common Council in the annual budget.
6-4. Institute a Progressive Local Income Tax: The Green Party urges adoption of a progressive local income tax, similar to the New York City and Yonkers income taxes, at the County level with a fair sharing of revenues between the county and its municipalities and school districts. Pending adoption of a progressive county income tax and revenue sharing, the City of Syracuse should seek New York State approval to levy a tax on income earned by residents and commuters to offset the regressive tax on properties (where about 50% of city properties are exempt) and generate revenue from commuters who use city infrastructure and services while working at tax-exempt governmental, higher education, and health care institutions.
6-5. Institute Progressive Property Tax Reforms: The Green Party calls for progressive reforms of the City property tax to prevent low-income people, including low income working people and families and retirees, from being forced to leave their homes due to property tax burden.
6-5a. Establish Progressive Property Tax Rates: We support establishing progressive rates based on the total value of each property owner's real estate, with reduced rates for farms.
6-5b. Institute a Property Tax Circuit Breaker: We support implementation of a property tax circuit breaker that would limit the percent of income one must pay in property taxes to protect homeowners with limited and fixed incomes from being unduly burdened by property tax.
6-5c. Establish a Renter's Property Tax Rebate: We support employing a rebate program that limits the percent of one's income one must pay in property taxes through rents, which include property taxes passed on by landlords.
6-5d. Use Land Value Taxation: The Green Party advocates allocating funds to study the viability of employing land value taxation as a tool to reform local property taxes. Land value taxation levies taxes based upon the market value of land but not its improvements (homes and businesses). The purpose of land value taxation is to restrict property taxes to the unearned income derived from appreciation of all land in the community, which reflects social investments in good schools, parks, and other infrastructure and amenities, not the actions of the owner. By discouraging speculative investment in abandoned city lots and buildings and sprawl, land value taxation stimulates inner city redevelopment and encourages compact development, supporting the anti-sprawl goals of city and county development plans. Because land ownership is far more concentrated than the ownership of home and business assets, land value taxation tends to make the property tax progressive.
6-5e. Move Toward Utilization of User Fees for Direct City Services: The Green Party calls for a restructuring of the City tax bill to re-categorize direct services, such as road repair and maintenance and trash collection, as user fees paid by all property owners, and the establishment of a user fee for municipal take-over of sidewalk maintenance and repair, including sidewalk snow removal.
6-6. Cut Sales Tax: The Green Party supports cutting the sales tax. Sales taxes are the most regressive local tax that hits poor and working people hardest. Sales tax revenues should be replaced with more progressive taxes, such as progressive income and property taxes.
6-7. Institute Eco Taxes: The Green Party calls for selective local eco-taxes on environmentally harmful products, pollution, and waste. Revenues from eco-taxes should be used to fund public services and reduce the regressive county sales tax. For example, the Onondaga County Resource Recovery Agency could be authorized to charge an eco-tax on trash headed for the incinerator on a “pay as you throw” fee schedule, scaled to the amount of waste put out for collection. This eco-tax would compensate OCRRA for lost revenue from burning trash and encourage households and businesses to reduce waste. Another example could be a county gasoline tax to supplement the Central New York Regional Transportation Authority (Centro) budget, improving our public transportation system and providing an incentive for commuters to use public transportation instead of private cars, thus reducing traffic, air pollution, and road maintenance costs.
6-8. Demand Resources to Comply with Mandate Requirements: The Green Party urges the City of Syracuse and Onondaga County to demand financial compensation from the federal and state governments for the costs of compliance with federal and state mandates.
6-9. Accept NYS Pension Smoothing: The Green Party calls for the City of Syracuse and the Syracuse School District to accept the pension stabilization plan approved in the 2013-14 state budget. The plan allows local governments and school districts to opt in to a payment plan that amortizes their costs for current pension payments over a 12-year period. It is similar to a plan put in place by the New York State Comptroller three years ago. The plan is reviewed periodically to ensure the payments are not too high or too low to meet expected costs. The pension stabilization plan also facilitates long term budget planning.