ALBANY, NY — The final New York State budget bills were passed late Friday, including a provision that will raise the minimum wage.
The increase to $8 an hour in 2014, to $8.75 in 2015 and to $9 in 2016 comes with a high cost to taxpayers. The taxpayer credits are estimated to cost $23 million in 2015.
“The tax credit to businesses will cost taxpayers $23 million in 2015 and jumps to $43 million in 2016, $45 million for 2017, and holds at $45 million for 2018 and 2019,”according to Morris Peters, spokesman for the Division of the Budget.
The minimum teen tax for about 75,000 teens from ages 16 to 19 who are still in school will see their employers receive $1.31 per hour as a tax credit. In the third year it will increase to a $1.35-an-hour tax credit.
“There is a provision that if the federal minimum wage should increase before the end of the five-year adjustment, then the subsidy would be reduced accordingly,” said Peters.
“Anybody who hires youth minimum wage workers, the minimum wage is going to go up absent these provisions,” said Morris Peters. “Their salary costs will go up. Now, we are basically saying we are going to pay for 85 percent of that salary increase. The taxpayers are subsidizing a large share of the increase. That’s why they are mad. They are saying they don’t have any employees. They are paying for people who do have employees.”
Members of the business community, including the Business Council, have expressed dismay and claim they did not advocate for any tax credit.
Governor Andrew M. Cuomo signed the final legislation last Saturday.