ALBANY — Gov. David A. Paterson on Tuesday proposed an additional 5 percent sales tax on luxury goods, such as jewelry and furs costing more than $20,000, as one of scores of tax and fee boosts intended to close a widening gap in New York’s budget.
Responding to the recession and the collapse of revenues from Wall Street, a key driver of the economy, Paterson is seeking to eliminate the sales tax exemption on clothing and footwear priced less than $110, but he would replace it with two one-week exemption periods on clothing and footwear purchases of less than $500. Municipalities would have the option of joining the state in offering the exemption. Restructuring the exemptions would generate $462 million in the 2009-10 fiscal year and $660 million the following year.
Paterson’s $121.1 billion budget plan would impose higher taxes on everything from personal services such as beauty, barber, manicure/pedicure and massage to beer and wine. It seeks to close a $15.4 billion budget gap over the next two fiscal years.
The luxury goods tax would raise $12 million in 2009-10 and $15 million in 2010-11.
The austere spending plan also mandates widespread service cuts and is expected to trigger a battle in the state legislature, which faces an April 1 deadline to approve it.
“Adjusting our state budget to reflect this new fiscal environment will be an extraordinary challenge,” Paterson said in prepared remarks.
Paterson proposed closing a loophole that allows certain vendors, such as private label credit card lenders (including department stores), to reclaim sales tax revenues from debts that are not repaid, but prohibits other vendors or lenders to access these revenues. The proposal would limit the credit refund to the vendor only.
The governor wants to remove the discrepancy in sales tax between manufacturers’ coupons and store-issued coupons.
Ted Potrikus, legislative liaison for the Retail Council of New York State, said he would have to review the proposals with their members before commenting.
In addition, Paterson wants to limit itemized deductions for high-income taxpayers. This would restrict the ability of taxpayers with incomes of more than $1 million to reduce their liability by claiming itemized deductions. At present, taxpayers with incomes in excess of $525,000 are allowed to claim 50 percent of the value of itemized deductions. Charitable deductions would be excluded from this proposal and may still be claimed as itemized deductions for the purposes of state income taxes.
In yet another fashion show shuffle, @elleryland is moving its show in sync with the Paris couture calendar — though the brand is still keeping one foot on the city’s ready-to-wear schedule. Their runway show in January will coincide with the launch of a new strategy: designing two main collections each year instead of four, which will then be released in four drops. “As we all know, the system needs to change. We need to show sooner to give time back to artisans and designers to do what they do best — create,” said founder Kym Ellery. #wwdnews #wwdfashion (📷: @kukukuba)
@maxmara’s classic 101801 coat was the cornerstone of its pre-fall 2018 collection. The design team expanded the traditional double-breasted, kimono-sleeved style into a trapeze coat, lean belted styles and a peacoat and presented them in monochromatic looks – like the camel one pictured here. #wwdfashion #prefall18 (📷: George Chinsee)
The @cfda has shifted the dates of #NYFW, with Men’s showing on February 5 through February 7, and Women’s will directly follow, running from February 8 through 14. The preliminary schedule will be released on the CFDA’s web site in the next few days, but Mark Beckham, VP of marketing for the CFDA, revealed that @rafsimons will be back to close the men’s-specific part of the week with a show on February 7 #wwdfashion (📷: Kelly Taub)
@ferragamo is introducing a new space dedicated to the development of women’s and men’s leather good samples. The laboratory, which is created eco-friendly materials and designed to reduce the environmental impact of the manufacturing processes, will allow the company to expand its accessories offering through traditional artisanal approaches. #wwdfashion (📷: @aitorrosasphoto)
How does a “regular, degular, schmegular” girl from the Bronx, N.Y., become a Grammy-nominated artist with a certified platinum record in less than a year? Call it the @iamcardib come up. The 25-year-old has become a musical sensation, and the fashion world is taking note. “If I could describe her style I would say drama. She’s really into the dramatics,” says Cardi B’s stylist @kollincarter. See how Carter styles her bold and out there looks with the link in bio. #wwdfashion
“There is no formula. There is no guideline. I can watch Ted Talks all day, but there is no one who can advise me on exactly what it is I should be doing,” said @ronniefieg, CEO of @kith, in an interview with WWD’s @ariahughes at the brand’s new SoHo office in Manhattan. Head to WWD.com to see how Fieg went from hanging out in shoe stockrooms at 13 to building his own business. #wwdfashion (📷: @weston.wells)
@fearofgod and @maxfieldla have teamed up on a pop-up installation. The store, located in the gallery space across from Maxfield’s Melrose Ave location, is the site of the brand’s House of God pop-up in which Fear of God founder @jerrylorenzo has created a church-inspired installation. A dozen vintage church pews sit in front of an LED screen playing 90s gospel singers in an effort to re-create an environment akin to a Southern Baptist Church, Lorenzo explained. Read more about the pop-up on WWD.com #wwdfashion (📷: Jennifer Johnson)
Known for his sleek, sophisticated American glamour, Norman Norell is the subject of an upcoming exhibition at @fitnyc. “Norell: Dean of American Fashion,” which runs from February 9 through April 14, will feature approximately 100 ensembles and accessories. His best work is exemplified by the designer’s glittering “mermaid” gowns frosted with thousands of hand-sewn sequins – like the one pictured. (📷: William Helburn) #wwdfashion
For pre-fall 2018, @balmain didn’t let go of the glitz. A crystal embroidered baseball jacket priced at around $40,000 hangs in the “couture” section of the brand’s first men’s pre-collection. Sporting the words “Balmain Army” across the back, the item took around two months to make. “When it was completed, it was like Christmas, it was like, ‘It’s done, it’s exactly what I wanted,’” said Balmain’s creative director @olivier_rousteing during a tour of the collection in a Paris showroom on Monday. #wwdfashion