ATTACK OF THE TAX MONKEY IN NEW YORK STATE

A new Citizens Budget Commission report using FY2024 data ranks New York as having the nation’s highest per‑capita tax burden and the second‑highest per‑person state spending. It notes that taxes and spending, driven by programs like Medicaid and public education, elevate living and doing‑business costs, potentially narrowing New York’s competitive appeal. The analysis urges holding or reducing taxes while improving service quality and efficiency to strengthen the state’s value proposition. It also highlights uneven public services and high property and sales taxes as part of the affordability challenge, signaling a tough outlook for ongoing competitiveness and growth. Looking ahead, the report implies that policy adjustments could improve attraction and retention of residents and businesses. Dive Deeper: The report analyzes the latest available data from fiscal year 2024 and compares state tax collections by local and state governments, finding New York at the top for per-capita taxation and second in per-capita spending among the contiguous states. New York’s per-capita taxes are about 22% higher than California’s, which is the next highest, and overall tax collections per person are roughly 71% above the national average, with New York also leading in personal income tax per $1,000 of income and in corporate taxes per $1,000 of GDP. On spending, New York allocates the most per capita across the contiguous United States, with spending levels about 44% above the national average, driven by Medicaid and public education programs. The report notes that high living costs and uneven public services compound the fiscal burden, weakening New York’s ability to attract and retain residents and businesses. Tax policy recommendations call for holding the line on taxes or reducing them while improving service quality, affordability, and government efficiency to restore competitiveness. Property taxes rank third highest in the state, sales taxes are sixth, and all other taxes are 13th highest, indicating a broad tax burden across multiple channels. The analysis suggests that without policy changes, increasing already leading taxes could worsen New York’s appeal by further elevating costs for residents and employers.