High Taxes and Policy Failures Fuel New York Exodus

0:00 Speaker 1 Well, Sunday morning. What is today is Paul Zuba and he’s the executive vice president of the Business Council of the State of New York, representing three thousand businesses. Well, is it still three thousands and a lot of them I’ve left Paul?

0:19 Speaker 2 Well, you know, John, with all this talk in Aubany about taxes, and you know, we talk about affordability at nauseum in Aubany, but it seems like every time we talk about affordability, everybody rises up and wants to do a new tax. And I don’t know how you can say that you’re making New York more affordable when all

0:41 you want to do is tax New Yorkers. And I think that’s that’s that’s a very very real, real problem. You know, there was this There has been rallies up here during the budget where you know, groups have asked for a millionaire’s tax, they’ve asked for an increase in the corporate tax. And I kind of find that that funny,

1:02 particularly in the corporate tax, because what a lot of people don’t realize, if you increase the corporate tax in New York State, you’re also increasing the taxes on coned national grid all the utilities. What does everybody think happens when you increase corporate taxes on a utility? What do they not realize that that all gets pushed onto your

1:27 your utility bill. So you’re you’re talking about Affordabille. You’re talking about use this money to like, you know, help New York City and help New York New York City taxpayers, and you’re you’re proposing a tax which will ultimately get passed on to consumer with higher utility rates and a lot of a lot of legislators and that’s that that’s

1:47 sometimes a problem in all of a.

1:48 Speaker 1 Lot of one of the big, big problems we have in New York. It keeps going up, up up now. I don’t know who talked about it, but somebody talked about that maybe we need a few business people up in the state Senate or in the state Assembly, uh or the governors surround himself, surround herself with better business

2:11 people because they don’t realize the the effects of what’s going on overall.

2:18 Speaker 2 They don’t And then and then they wonder why we have all these people who want to go to Texas and want to go to Florida because they don’t get hit with these taxes, right, and and and and and it’s a real problem. And the more we lose people, particularly in the financial services industry, the less again, the

2:37 less money there is in terms of tax revenue for New York City. And it doesn’t seem like anybody understands this. And so now I guess the new thing in Aubany is the governor has decided and the legislator has decided that in order to give New York City the money to close the budget app. Because instead of doing what

2:54 most most mayriorgs would do with a budget app, they would they would cut spending. They’ve done this piet To tier tax, which is basically a second home tax on people who have decided to buy property in New York City.

3:09 They are expensive pieces of property. They don’t live in New York City. It’s a second home. But again, you know, what we’re failing to comprehend is several things with us. So what do we do with the person who has the second home in New York City? But say they have a business in New York City, Say they’re I

3:28 don’t know, in the financial services sector, or they have a company and they’re creating jobs in New York City, and they’re paying property taxes in New York City.

3:37 Speaker 3 Not everybody, not everybody understands that. Does that mean everything?

3:41 Speaker 1 If I move my official residence to Florida and I still own a condo in New York, now I’m going to pay double taxation.

3:52 Speaker 2 Yeah, but you’re still but you still have your grocery store and you still have your your companies in New York City, So you’re still creating money. So why should you have to now pay at tax on top of attacks even though you’re contributing to the economy in New York.

4:08 If you’re going to do these things, at least think them out in a way that makes sense. And that just completely doesn’t make sense. And then what you end up doing is you end up telling people, well, we don’t really want you here, we don’t want we don’t want your business here. And it’s becoming a very very real.

4:27 Speaker 1 Is that why President Trump was really upset about what some of those things. I know his family still owns, His sons still own a lot of.

4:34 Speaker 3 Real estate in New York.

4:36 Speaker 1 Yeah, well but you know they they self condos to a lot of foreign buyers.

4:41 Speaker 2 Yeah, but you know what the funny part is, John the New York City. You know, real estate evaluation system is so like you know, nineteen eighties ish and so messed up that some of these properties that all these you know, progressive let’s go get them legislator think are going to get caught up, actually will not probably get

5:03 caught up in the way the tax is currently written in the legislation. So for example, you know, I think a couple of papers have done an article that President Trump’s property at Trump Tower probably would have been included in this. Now I know that.

5:19 Speaker 3 Let me understand it.

5:20 Speaker 1 Let’s say I’m a I’m a German buyer, and I came in and buy. I bought a ten million dollars condo and Trump talent. What does the state want from me besides the ten million I write to bid the.

5:35 Speaker 2 They will tax your property if it’s over The latest version that I’m hearing is if it’s over a five million dollars, So it’s a ten.

5:43 Speaker 3 Million dollars condo I bought. How much is the tax?

5:46 Speaker 2 Yeah, so if it’s over a five million a sus value, they’re going to put a tax on it. What their final tax would be is unclear, but they will they will tax that that property, even though you’re not using any services in New York, even know you’ve invested in New York. They are going to tax that property. And

6:03 it will not matter, like I said before, whether or not you’re that German buyer who happens to live in Germany but also happens to have a company that’s that’s hiring people and creating and creating economic development in New York City. It’s just going to be a straight, a straight tax on you, and it’s going to like you

6:23 like you’re you’re implying, John is going to disincentivize people from purchasing properties.

6:30 Speaker 1 But a lot of very important thing is how much are the numbers going to be, because you know, we got.

6:33 Speaker 3 To know the truth.

6:35 Speaker 2 Yeah yeah, well, I mean I think that’s what we’re all waiting to see as to what the ultimate numbers will be and how are they also going to implement this, because it’s going to be very difficult to implement because, as you know, a lot of some of those larger, larger condo purchases, they’re usually not purchased through an individual.

6:54 To purchase through an LLC, you’re going to have to find a beneficial LLC owner.

7:00 Speaker 3 But if they do.

7:02 Speaker 1 But it’s like I real estate tax. The tax goes on top of the ownership, so someday, whether you pay it right then and nail, you have to pay it some day. It’s it’s a lean on the property. Mm hmm.

7:17 Speaker 1 That’s why we have to find out exactly what they mean, because they’re gonna hurt.

7:21 Speaker 3 They’re gonna hurt New York City, New York State.

7:24 Speaker 2 Yes they are. And and that’s part of the problem here is because there’s so there’s there’s this this uh, this energy to kind of go after what people perceived as the millionaire class, right, and so you know, this is their workaround because the governor has refused to do a millionaires tax. So this is what they feel like

7:48 they’re going to They’re gonna get all those all those millionaires in New York City by by doing this particular at tax. I mean, I think you saw that, you know, the mayor when when this was announced, did a video in front of one of the one of the very successful individual’s home, you know, claiming that you know, he

8:08 got him. I was going to tax the rich, and I’ve taxed a rich But again, you know your point, and I think everybody’s point is whether I don’t care, like we can debate like who’s leaving the city, But it was very clear when the IRS put out that or recently that people are leaving the city. People are

8:26 leaving New York State. Right, They’re leaving New York State because there are better tax tax structures in other states. The weather’s better, the environment better, welcoming is better.

8:38 Speaker 1 Well, had a time, but this is the people want to know the truth. And thank you for forgetting us there, but we you know, when you find out exactly how much it’s going to cost, please let us know.

8:52 Speaker 3 I will thank.

8:53 Speaker 1 You so much for coming on this Sunday morning, and keep praying for New York.

8:59 Speaker 2 I will John