MTA Payroll Tax Cut Gets Mixed Reactions in Croton

CROTON-ON-HUDSON, N.Y. – The MTA Payroll Tax Cut signed into law by Governor Andrew Cuomo has been lauded by local representatives, like New York State Sen. Greg Ball (R,C,I- District 40), but some local businesses say they will barely notice the difference.

“You know it’s all handled by my payroll company, and I don’t even notice it. It’s so insignificant, and the money goes towards keeping public transit,” said Craig Purdy, owner of Umami Café in Croton. “I’m rather okay with having some money devoted to public transit,” but he said, “I need customers, and the public at large needs to have spending power.”

The tax applies to 34 cents of every $100 of payroll for the seven counties outside of New York City that are served by the MTA Metro-North rail lines. The original idea for the tax was that these communities benefit economically from having a train station.

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 more than 25,000 businesses in Westchester County.  Businesses with payrolls between $1.25 and $1.75 million will have their payroll taxes cut by either 1/3 or 2/3,according to the governor’s website. 

The new tax cut, signed into law by Cuomo on Monday, exempts elementary and secondary schools, both public and private from paying the tax. Public schools originally had to pay the tax and were later reimbursed, but will no longer have to pay those upfront costs.

Karen Zevin, president of the Croton-Harmon Board of Education, said “It should never have been done in the first place. Most of the people who work at a school don’t use the MTA, especially here and when you go further north, they’re not using the MTA. The bottom line is you can’t ask one government entity to pay for another,” she said.

Zevin said from her perspective, as a self-employed market research consultant, she actually paid the tax multiple times because her property had so many different taxing authorities. Municipalities are not exempt from the 0.34 percent tax. About 414,000 self-employed workers statewide will also be exempt from the tax.

Some transit officials have criticized the governor for reducing the tax, saying the state’s reimbursement will not grow revenue like a payroll tax might.

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