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After Oversight, Libraries Exempt From MTA Tax

BEDFORD HILLS, N.Y—The MTA Payroll Tax Reform Bill will offer a welcome reduction in the following fiscal year, with small businesses reaping the benefit after having to cough up money to the Metropolitan Transit Authority since the tax was passed in 2009. Libraries, though, were left out of the initial exemption, said Michael Borges, executive director of the New York Library Association. 

In an email sent out by Borges to members of NYLA, he explained how, despite the lack of naming in the reform bill, libraries will be included in the exemption. “The Senate Majority has informed me that leaving libraries out of the full exemptions (like private and public schools) was an oversight and that they plan to address it in the 2012-2013 budget.”

The tax will be eliminated for small businesses, which are defined as businesses with an annual payroll between $10,000 and $1.25 million by the governor’s official website.  The elimination of the tax affects just over 25,000 businesses in Westchester County.  Businesses with payrolls between $1.25 and $1.75 million will have their payroll taxes cut by either one third or two thirds, according to the governor’s website. 

Bedford Hills Free Library officials were pleased to hear of the announcement, even though they would have been exempt either way as their payroll is under the $1.25 million ceiling.

“We are very pleased not to have to pay the tax and any decrease in costs helps us to meet our operating costs and is welcome,” said Rhoda Gushue, director of the Bedford Hills Free Library.

To make sure, the library was active in letting Albany know of its stance on the MTA Tax. “We expected we would be part of it. We were sending in letters to the governor expecting that it would bolster our being part of it,” said Gushue. “But they left the word out. But now, at the end, it does state that it was an oversight.”

All public and private elementary and secondary schools are exempt from the payroll tax under the new law as well. Under the old law, schools had to pay the tax up front before being reimbursed for it.

The governor’s website also claimed the new law will have no impact on MTA funding as the state will compensate it for any revenue lost due to the tax cut. The law will save money for nearly 290,000 small businesses and more than 410,000 self-employed New York residents in the seven counties.

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