Metadish, Fresh from NYC

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Mayor Bloomberg thinks that we should cut property tax by 5 percent and do away with city sales tax on clothing and shoes because, this year, we experienced a booming economy and real estate market.

This tax relief package, which also includes measures meant to benefit small businesses, would consume $1 billion of the city’s $55 billion budget.

New York Times reported:

The mayor has already begun seeking an extension of the popular $400-a-year property tax rebate for the owners of one-, two- and three-family homes and co-op and condominium apartments through 2009. That rebate started in 2004, but the annual program will end if the state does not reauthorize it.

Bloomberg administration officials said that reducing the property tax rate was needed to reauthorize those rebates, since when Albany originally granted permission for them, lawmakers required the city to lower its overall tax rate in order to extend the rebate program past 2006.

Under the mayor’s sales tax proposal, an existing exemption from the 4 percent city sales tax for clothing and footwear under $110 would be extended to purchases above that amount. The city cannot, however, expand the parallel exemption for clothing items under $110 from state sales tax and a Metropolitan Transportation Authority sales tax surcharge to purchases above that amount. So those items would still be subject to the state and M.T.A. tax, a combined 4.375 percent, rather than the current 8.375 percent city, state and M.T.A. tax.

Such a change would make clothing sellers in the five boroughs more competitive with those in New Jersey, where all clothing is exempt from the sales tax. In Connecticut, clothing under $50 is exempt from the state’s 6 percent sales tax.

Finally, Mr. Bloomberg is proposing changes to business taxes that would bring city policy more in line with federal and state provisions, officials said. Those include increasing deductions, creating credits and simplifying filing requirements for unincorporated business and some corporations, with an eye toward helping small-business owners.

Even though his popularity decreased when he raised taxes by 18.5 percent last year and he has expressed interest in running for a national office, Bloomberg does not have an agenda.

Cutting property tax just makes more sense than providing health insurance benefits for those who do not have it, fixing the schools or improving the quality of low-income housing. Giving a little bit more money to people who are wealthy enough to own property in one of the most expensive cities in the world is probably the best thing that Bloomberg can do.

Bloomberg Plans to Cut New York’s Property Taxes [New York Times]

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