Cuomo Has a Deal to Tax the Rich [Updated]

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Photo: Jemal Countess/2011 Getty Images

Governor Andrew Cuomo and leading  state legislators have reached a tentative agreement that will allow the New York millionaires' tax to expire, but create new tax brackets and change some rates in an attempt to address the $3.5 billion budget gap, lessen the burden on middle-class residents,  and piss off Mayor Bloomberg. Under the new deal, New Yorkers making over $2 million would pay 8.82 percent state income tax, while anyone making under $300,000 would get a tax cut. Those making between $40,000 and $150,000 would pay a 6.45 percent tax, and anyone making between $150,000 and $300,000 would pay 6.65 percent. Previously, individuals earning more than $20,000 and couples earning more than $40,000 were taxed 6.85 percent (plus a surcharge, or the "millionaires' tax," for those making more than $200,000 a year individually or more than $300,000 on a joint return.) While extending the current "temporary" rates for top earners, which were adopted in 2009, would have raised about $4 billion for the state, the new plan is expected to bring in $1.9 billion. Related: Why Andrew Cuomo Should Proudly Tax the Rich [NYM]