NYC mayor expected to propose sweeping tax cuts

New York City Mayor Michael Bloomberg is expected to propose sweeping property and sales tax cuts in his annual State of the City address on Wednesday afternoon, local media reported.

Under the mayor's proposal, property tax will be lowered by 5 percent, saving homeowners about 200 U.S. dollars a year on average.

The mayor is also expected to propose eliminating city sales tax on all clothing and footwear. The existing exemption from the 4 percent city sales tax for items under 110 dollar would be extended to purchases above that amount.

Items over 110 dollar, however, would still be subject to the state and the Metropolitan Transportation Authority tax, a combined 4.375 percent.

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

Finally, Bloomberg is expected to propose measures such as increasing deductions, creating credits and simplifying filing requirements for unincorporated business and some corporations, with an eye to helping small-business owners.

The tax cuts represent a major turnaround for the city since Bloomberg's first State of the City address in 2002, when he called for higher taxes and budget cuts in the aftermath of the Sept. 11 attacks.

The mayor's proposal is likely to get a sympathetic hearing from the City Council, whose members have been calling for tax relief.

Source: Xinhua