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What you need to know for 01/18/2018

Tax cuts? Is GOP kidding?

Tax cuts? Is GOP kidding?

Editorial: How can New York afford them?

It didn’t take Senate Republicans long to come up with a way to spend the extra $200 million in revenue the state found last week. In their party’s time-honored tradition, they’d cut taxes — not just by the amount of the windfall, but nine times as much.

The tax cuts, including a revival of the STAR rebate check, need to be seen in the context of an overall budget plan — the Senate is expected to release one this week — but we’d be surprised if they are affordable. After all, the economy remains fairly stagnant, federal Medicaid cuts and the sequester are expected to create even larger holes in the state budget, and the issue of school aid disparities has yet to be addressed.

Who wouldn’t just love a $450 check in the mail this summer? (This gesture alone would cost the state $1.3 billion.) And what parent wouldn’t want an extra $1,020 tax write-off per child or $45 tax credit, etc.? All of these would be helpful for millions of New Yorkers, while depriving the state of revenue needed for other priorities.

Things like eliminating the tax on utilities that was supposed to sunset next year but that Gov. Andrew Cuomo has proposed retaining: Republicans support getting rid of it, but doing so would cost $500 million. Then there are the budget gaps created by a $500 million cut in federal Medicaid funding and $275 million worth of “sequestration” cuts. Where will that money come from?

There’s also the controversial issue of school aid fairness that the Legislature was supposed to have dealt with six years ago, but hasn’t to this day: the fact that many poor school districts are actually getting less operating aid per-pupil than rich ones. It would be close to impossible politically for lawmakers to rejigger the formula a la Robin Hood, so the ultimate solution is going to cost more. The money for it should have been stashed away years ago.

Tax cuts are fine when there’s money around, but that’s hardly the case with the state, which continues to carry enormous debt, has a hard time balancing its books every year without borrowing, and has important expenses ahead of it to boot.

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