Protecting New York’s Economy: Coalition Urges Rejection of FY27 Tax Increase Package

Summary

SIFMA and other Joint Trades provided comments to New York State Leadership to urge them to reject, in full, the sweeping tax increase package under consideration in the fiscal year 2027 state budget.

Excerpt

We represent 30 trade, business, and research organizations from every region of New York state, collectively representing millions of New Yorkers — workers, small businesses, employers, and families. We write to urge you to reject, in full, the sweeping tax increase package under consideration in the fiscal year 2027 state budget.

We appreciate the governor’s leadership at the outset of this budget process. The Executive Budget recognized the importance of affordability, competitiveness, and fiscal discipline, advancing a balanced approach without broad-based tax increases while prioritizing practical reforms to support New Yorkers. That framework reflects a clear understanding of the moment. One important exception, however, is the less visible but materially consequential research and experimentation (R&E) decoupling provisions from federal cost-recovery rules, which should be removed.

By contrast, the One-House proposals move in the opposite direction. Taken together, these proposed tax increases would raise costs across the entire private sector. They include higher corporate tax rates, increased taxes on high earners, expanded New York City business taxes, new burdens on financial institutions, higher taxes on partnerships and freelancers, limits on PTET credits that result in double taxation, the extension of the capital base tax, increased real estate transfer taxes, and additional industry-specific tax hikes.

At a time when affordability remains a top concern and employers are actively deciding where to invest, hire, and grow, this approach risks pushing New York further out of alignment with competing states.

The impact will not be abstract. Higher costs at the state level flow directly into hiring decisions, wage growth, consumer prices, housing affordability, and long-term investment. Raising taxes in a fragile economic moment does not make New York more affordable; it makes it more expensive and less competitive.

New York has already increased taxes in three of the last five budgets, even as other states compete aggressively for jobs, capital, and talent. Additional cost increases risk pushing investment and growth elsewhere, including through lesser known but still harmful provisions such as the proposed R&E federal decoupling changes, which would retroactively raise taxes on innovation and investment and reduce cash flow for hiring and growth.

These tax increases will not solve the state or city’s underlying fiscal challenges. Without structural reforms to control spending and improve efficiency, new revenue will be temporary while the long-term impact on the economic base will be lasting.

We urge you to reject this tax increase package in its entirety. New York’s future will be secured by growth, jobs, competitiveness, public safety, affordability, housing, quality of life,
and accountable government. This is the moment to strengthen those foundations and protect the economic ecosystem that supports millions of New York families.

Our coalition stands ready to work with you to advance solutions that strengthen New York’s economy and expand opportunity for all.