The state Senate tonight passed legislation to repeal a payroll tax on businesses within the New York City-area transit system.
The payroll tax has been criticized for hurting companies in New York City and its suburbs, including Dutchess, Putnam, Rockland and Westchester counties. It was implemented in 2009 to bail the Metropolitan Transportation Authority out of a fiscal crisis.
The bill in the Republican-controlled Senate would repeal the tax in the 12-county MTA region by 2014, with a phase-out beginning in January. The measure faces an uncertain future in the Democratic-led Assembly, where is it sponsored by Assemblyman George Latimer, D-Rye, Westchester County.
The Senate bill would begin in January by exempting small businesses of 25 employees or less, as well as public and private schools.
Senators said the bill would help the MTA offset $465 million in losses from payroll tax revenue through several initiatives, such as directing $100 million in federal greenhouse gas funds to the MTA.
The rest, about $375 million, would have to be absorbed by the MTA.
“It’s time for the MTA to stop balancing its budget on the backs of hard-working New Yorkers,” said Sen. Greg Ball, R-Patterson, Putnam County.
Some Democratic senators also backed the bill, including Sens. Andrea Stewart-Cousins, D-Yonkers, and Suzi Oppenheimer, D-Mamaroneck, Westchester County.
“Reducing the strain on already burdened taxpayers is the right thing to do,” Oppenheimer said.
The Senate also passed a bill to conduct an audit of the MTA.