“Millionaires can breathe a bit easier. While President Barack Obama says he wants to let income tax cuts that benefit only the wealthiest Americans expire in 2013, several states are rolling back tax increases for top earners,” Steven Sloan reports for Businessweek.
“New York’s highest tax rate on incomes exceeding $500,000 will fall back to 7.85 percent, from 8.97 percent, this year. Maryland’s 6.25 percent tax on incomes above $1 million expired at the end of 2010, while California’s top tax rate for millionaires has dropped to 10.3 percent from 10.55 percent,” Sloan reports. “The soak-the-rich drive ‘just petered out,”‘ says Joseph Henchman, vice-president for legal and state projects at the Tax Foundation in Washington, a group focused on lowering taxes. ‘All of these states are backing away now.'”
“Business groups have been vocal opponents of the temporary hikes,” Sloan reports. “In California, the Silicon Valley Leadership Group, whose members include Bank of America, Apple, and Microsoft, along with 12 other business groups, have told lawmakers that tax increases should be extended only if lawmakers agree to ‘structural reforms’ of the budget.”
“Republicans, who typically oppose tax hikes, now hold a majority of governorships — 29 — and many were elected last year after campaigning against tax increases. New Jersey Governor Chris Christie, a Republican, received national attention after vetoing a bill that would have extended a tax on millionaires in the state,” Sloan reports. “Some Democrats are also fighting the higher taxes. New York Governor Andrew Cuomo sparked a battle with fellow party members in the legislature earlier this year by opposing legislation that would maintain the higher rates on individuals earning more than $1 million. Maryland Governor Martin O’Malley, a Democrat, didn’t push to extend his state’s millionaire tax last year.”
Sloan reports, “A few states are bucking the national trend. Connecticut has raised its top tax rate from 6.5 percent to 6.7 percent. Oregon voters approved a measure in January establishing two new tax brackets: 10.8 percent for those earning more than $125,000 and 11 percent for those making more than $250,000. District of Columbia Mayor Vincent Gray proposed raising taxes for residents earning more than $200,000, but the District council nixed the plan.”
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MacDailyNews Note: The Silicon Valley Leadership Group, founded in 1978 by David Packard of Hewlett-Packard, represents more than 325 Silicon Valley employers on issues, programs and campaigns that affect the economic health and quality of life in Silicon Valley, including energy, transportation, education, housing, health care, tax policies, economic vitality and the environment. Leadership Group members collectively provide nearly one of every four private sector jobs in Silicon Valley. The Silicon Valley Leadership Group’s website is here.