New York's wealthy to invest more in their state

As Washington’s legislature unveils its proposed budget for the 2010-2011 biennium, 47 other states are also grappling with their own budget shortfalls. One such state is New York which made a deal this weekend to temporarily raise taxes on the very rich in order to help balance its $16 billion budget deficit.

New York wasn't afraid to do what was necessary in order to maintain important state services, and they also made their tax code more fair and progressive in the bargain:

Saturday night's budget deal overhauls the state's income tax rates to get $4 billion from wealthier residents who have been paying about the same rate as a family making $40,000 a year. The agreement will increase the current top rate of 6.85 percent. Residents making more than $300,000 but less than $500,000 would face an income tax rate of 7.85 percent. Those making more than $500,000 would see a rate of 8.97 percent.

Raising taxes on those who can afford to pay them when so many citizens are in deep financial straits is the fair thing to do. N.P.I. applauds New York for having the political chutzpah to enact fair tax policy. A new Democratic majority in the New York state legislature this fall, plus a Democratic governor made this change possible.

What prevents Washington with its similar Democratic controlled state government from enacting a more progressive tax code as well? If a state income tax can’t be enacted with this disastrous budget looming over us, then what chance does it have in less necessary times?

The sad answer is that state government lacks the political will for change and there is also a lack of citizen leadership within the state to press the issue. It will take a combined effort of citizens, business, academic and media influences to make our tax code more fair and less subject to the changing winds of the economy.

How do we start the discussion on tax reform? A good place to start is by talking to our neighbors and friends. We can also write letters to the local newspaper and our legislators advocating for a more progressive tax system, including a state income tax.

With over half of our state revenue coming from sales tax, it’s time to stop funding state services on the backs of those who must spend their entire paychecks on necessities, and find a way to better balance the load.