ALBANY – Gov. Paterson yesterday socked New Yorkers with a mind-boggling 137 proposed new and hiked taxes on everything from beer to cab rides to iTunes downloads and movie tickets.
The doomsday, $121.1 billion plan represents the biggest tax hike in state history and slashes services across the board – while still increasing spending by $1.4 billion.
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The Draconian plan calls for:
* An “iTunes tax” of 4 percent on videos, music or pictures downloaded from the Internet.
* A 4 percent tax on taxi, limo and bus rides. That means a $10 cab ride would cost 40 cents more.
* A 4 percent entertainment tax on tickets to movies, concerts and sporting events. That would add nearly 50 cents to a $12 movie ticket or $1.80 to the cheapest $44.50 seat at a Knicks game.
* The tax on beer increases 24 cents per gallon, or more than double the current rate, which means about 30 cents a case.
* An 18 percent tax on nondiet soft drinks, which aims to reduce child obesity. A $1.50 can of Pepsi would then cost at least 25 cents more.
* A 4 percent tax on cable TV and satellite services, raising a $100 bill by $4.
* Hiking the cost of “personal” services – including haircuts, manicures, pedicures, massages and gym memberships – by 4 percent.
* A 4 percent sales tax on clothing and shoes under $500, except for two weeks out of the year.
* Elimination of the law that caps the state sales tax on gasoline at 8 cents per gallon.
* Boosting the average vehicle registration fee for drivers by $11, from $44 to $55. Fees for new or renewed licenses also would increase 25 percent, or increase from $50 to about $62 to renew a license over eight years.
In addition, all drivers would have to get new, “reflectorized” license plates at a fee of $25 each.
The plan also calls for the state to allow wine to be sold in grocery stores.
It would introduce video slot machines at Belmont Park.
New York could also join other states in their lottery games.
State officials estimate the plan would raise $4.6 billion annually – or the most in “revenue actions” in state history.
On the flip side, it calls for cuts of $9.5 billion, including radical reductions to hospital and school subsidies and the elimination of more than $1 billion in aid that City Hall hoped would help it weather the worst economic downturn in at least a generation.
Despite all the taxes and cuts, spending still would increase by 1.1 percent over last year’s $119.7 billion budget.
In delivering his budget to lawmakers, the governor said Albany’s overspending – not Wall Street’s downturn – was to blame for the $15.4 billion budget gap he promised to close.
“Unfortunately, we have lived beyond our means,” the Democratic governor said. “We have to recognize that we’ve made too many promises and unfortunately asked for too few sacrifices. We are going to have to change our culture as we know it.”
His plan immediately came under fire from both the left and the right.
“The pain in this budget seems to be strictly for the middle class,” said Sen. Martin Golden (R-Brooklyn). “You name it, [Paterson] taxes it. If anybody’s contemplating leaving the state of New York, this should push them over the top.”
Paterson laid out dramatic cuts to education and health care, which together make up more than half of the state budget. Powerful lobby groups for both sectors quickly lined up to fight the proposal in the Legislature.
“These are staggering cuts that will shatter New York’s health-care infrastructure,” said SEIU 1199 President George Gresham and Greater New York Hospital Association President Kenneth E. Raske in a joint statement.
Billy Easton, who heads the Alliance for Quality Education, added, “The governor has shifted the unbearable burden of closing the budget gap onto the shoulders of school children while sparing the wealthiest New Yorkers.”
Additional reporting by David Seifman