Businesses Bailout New York State Debt to the Federal Government

The Governor of New York has explicitly stated that there will be “no new taxes.”

Yet, this past month, thousands upon thousands of businesses across New York State received a letter that stated in part,

“The recent national recession led to record high numbers of unemployed workers — New York State had to borrow over $3 billion from the federal government — “

The letter went on to state that the federal government is demanding that the interest be paid and New York doesn’t have the money to pay the loan. Therefore, the Department of Labor has decided to get businesses in New York to ante up the cash.

“In order to pay the interest due to the federal government of approximately $95 million in interest on these loans by September 30, 2011 — “

Instead of levying a tax because the governor has said repeatedly that there will be “no new taxes,” the Labor Department is calling it “An Interest Assessment Surcharge for 2011.”

I would like to inform the governor, the NY Senate and Assembly and everyone at the Department of Labor that the definition of tax is as follows:

“A sum of money demanded by the government for its support or for specific facilities or services that is levied upon income, property, sales, etc.”

The Interest Assessment Surcharge is a TAX even though the governor and the Department of Labor have renamed it. When the local businesses are being sacked with taxes it will inevitably trickle down to the consumer one way or another.

Businesses across NYS are scrambling to pay these fees before their deadline or face penalties and interest charges. And, if the federal government decides to extend the deadline for New York to payback the loan interest, New York has informed the business owners that they will not be receiving a refund of their money rather it will be put on their accounts in the form of a credit that will not pay them interest. Imagine that.

A tax by any other name still stinks.


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