Slapping Sense Into the Taxman

The Cuomo tax was thought by many legislators to be “a perfect tax” because it affected only millionaires. Unfortunately, that thinking was flawed, because those are the very people who create economic activity resulting from their investments.

Moreover, another error in that thinking was that it didn’t take into consideration all of the people who lived and shopped and worked in the neighborhoods that stagnated during the years the tax was in effect, and that have since benefited from new construction and increased investment. It didn’t take into consideration the union construction workers who build or renovate or convert buildings that have been sold or constructed since the tax’s repeal. And lastly, it didn’t take into consideration the real estate professionals, attorneys and title closers who saw activity increase after the tax disappeared. 

The arrogance in thinking that companies and individuals will put up with anything to stay in New York is ill-advised. While it is overly simplistic to argue that taxes alone decide where businesses locate and people live, it is equally absurd to conclude that taxes make no difference in such decisions. We should all encourage politicians to have the guts to take difficult positions when it comes to cutting spending. We must adjust spending to sustainable levels given the outlook for future revenue receipts, and do so while implementing balanced tax policies.

If done correctly, this approach will promote investment, create job growth and lead to a brighter future for our city.

Robert Knakal is the chairman and founding partner of Massey Knakal Realty Services, and has brokered the sale of more than 1,000 properties in his career.

Slapping Sense Into the Taxman