Republican Senators representing districts with large numbers of New York City commuters have sent a letter to Mayor Michael Bloomberg expressing their strong opposition to any effort to restore a .45% income tax on New Jersey commuters working in New York City.
The proposal to bring back the “commuter tax”, which was abolished in 2000, has been floated by Manhattan Borough President and 2013 Mayoral candidate Scott Stringer. Proceeds from the levy would be used to bail out the long-dysfunctional Metropolitan Transportation Authority (MTA).
The text of the letter reads as follows:
Dear Mayor Bloomberg,
As New Jersey state Senators representing large numbers of constituents who commute to New York City each day for their jobs, we are alarmed at recent comments made by Manhattan Borough President Scott Stringer proposing to reinstate a .45% income tax on non-city residents working in the five boroughs. We respectfully request that you oppose any and all efforts to restore this punitive levy.
The tens of thousands of New Jersey residents that commute each day pump millions of dollars into New York City’s economy. These workers are a net benefit to city coffers; paying income taxes to the city and state of New York without availing themselves of most city services that are used by residents.
Balancing the city’s budget on the backs of these commuters is both unjust and shortsighted.
In 2000, the New York State Court of Appeals struck down a similar commuter income tax on out of state residents as unconstitutional. While it is our understanding that Mr. Stringer’s proposal would circumvent the Court’s concerns by restoring the levy on New York State residents as well, we believe the plan to be equally discriminatory. New York City would be singling out a particular class of people who have no recourse at the ballot box nor representation in city government. It is worth noting that New Yorkers employed in New Jersey face no similar treatment, as state law does not allow for such targeted, local levies.
Moreover, the commuter tax is bad economic policy for the region as a whole. Raising taxes in an already highly taxed, high cost area serves only to take more money out of the pockets of New Jersey residents who spend their income both at home and in New York. Weakening the financial position of these individuals will result in a net economic loss to both New Jersey and New York City. Our economies are inextricably linked, and adding an additional burden to this population risks adverse consequences that transcend state lines.
Finally, we question the efficacy in offering yet another taxpayer bailout to the MTA. As you are well aware, the current MTA tax levied on city residents has not effectively stabilized the finances of an agency widely acknowledged to be a bastion of waste and mismanagement. Until such operational deficiencies are remedied, dedicating additional revenue to the MTA is simply throwing good money after bad.
We realize that talk of restoring the commuter tax is likely driven by the political ambitions of those seeking to succeed you as Mayor. However, should the issue come before you, it is our sincere hope that you will join in our opposition and exercise your authority to prevent such a tax from becoming law.
Tom Kean, Jr.
New Jersey State Senators