NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5435
SPONSOR: Solages TITLE OF BILL:
An act to amend the tax law, in relation to top personal income tax
rates
TITLE OF BILL:
An act to amend the tax law, in relation to top personal income tax
rates
PURPOSE OR GENERAL IDEA OF BILL:
To create a new permanent higher personal income tax rate for the high-
est personal income tax brackets in the state
SUMMARY OF PROVISIONS:
Section one of this bill amends subparagraph (B) of paragraph 1 of
subsection (a) of Section 601 of Tax Law to create a new, higher
personal income tax (PIT) rate of 10.8% for incomes of $5 million and
above and 11.4% for incomes of $25 million and above. This is the
subsection of Section 601 that contains the tax table for the married
filing jointly and surviving spouse tax statuses.
Section two of this bill amends subparagraph (B) of paragraph 1 of
subsection (b) of Section 601 of Tax Law to create a new, higher
personal income tax (PIT) rate of 10.8% for incomes of $5 million and
above and 11.4% for incomes of $25 million and above. This is the
subsection of Section 601 that contains the tax table for the head of
household tax status.
Section three of this bill amends subparagraph (B) of paragraph 1 of
subsection (c) of Section 601 of Tax Law to create a new, higher
personal income tax (PIT) rate of 10.8% for incomes of $5 million and
above and 11.4% for incomes of $25 million and above. This is the
subsection of Section 601 that contains the tax table for the single and
married filing separately tax statuses.
Section four of this bill makes a conforming change to subparagraph (B)
of paragraph (1) of subsection (d-4) of Section 601 of Tax Law to
include the higher 11.4% PIT rate in the existing benefit recapture
provisions of law for married filing jointly and surviving spouse tax
filers that have more than $25 million of income. "Benefit recapture"
means that the maximum tax rate is applied to all of a filer's income if
the income exceeds the top tax bracket of $25 million rather than only
to the portion of the income that exceeds $25 million.
Section five of this bill makes a conforming change to subparagraph (B)
of paragraph (2) of subsection (d-4) of Section 601 of Tax Law to
include the higher 11.4% PIT rate in the existing benefit recapture
provisions of law for head of household tax filers that have more than
$25 million of income.
Section six of this bill makes a conforming change to subparagraph (B)
of paragraph (3) of subsection (d-4) of Section 601 of Tax Law to
include the higher 11.4% PIT rate in the existing benefit recapture
provisions of law for single and married filing separately tax filers
that have more than $25 million of income.
Section seven sets the effective date.
JUSTIFICATION:
Increasing New York's top tax rates for those earning over $5 million
and over $25 million by 0.5% would generate up to $3 billion for the
state to invest in working-class New Yorkers' basic needs like child
care, education, healthcare, transportation and housing.
This bill, which is drawn directly from proposals in the FY25 Senate and
Assembly one-house budgets, would raise personal income tax rates on
those who can most afford it in order to ensure that New York is able to
fully fund critical public services. Our tax system has evolved to bene-
fit the very wealthy. America's billionaires - about 800 people -
control 57% more wealth ($5.8 trillion) than the entire poorer half of
U.S. society, roughly 65 million households ($3.7 trillion).
Majorities of all Americans support higher taxes on the very rich. In
New York, more than two-thirds of voters say the government should raise
taxes on corporations and the wealthiest people to improve services for
New Yorkers. After decades of being sold trickle-down economics, we now
see it is empty rhetoric, The very rich are getting richer at the
expense of working Americans, who feel like they are working harder than
ever. These changes to New York's tax laws would provide the resources
and programs to keep families and college graduates in the Empire State.
PRIOR LEGISLATIVE HISTORY:
None
FISCAL IMPLICATIONS:
TBD
LEGISLATIVE HISTORY:
New bill.
EFFECTIVE DATE:
Immediate
STATE OF NEW YORK
________________________________________________________________________
5435
2025-2026 Regular Sessions
IN ASSEMBLY
February 14, 2025
___________
Introduced by M. of A. SOLAGES -- read once and referred to the Commit-
tee on Ways and Means
AN ACT to amend the tax law, in relation to top personal income tax
rates
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Clauses (vi) and (vii) of subparagraph (B) of paragraph 1
2 of subsection (a) of section 601 of the tax law, as amended by section 1
3 of subpart A of part A of chapter 59 of the laws of 2022, are amended to
4 read as follows:
5 (vi) For taxable years beginning in two thousand twenty-three [and
6 before two thousand twenty-eight] the following rates shall apply:
7 If the New York taxable income is: The tax is:
8 Not over $17,150 4% of the New York taxable income
9 Over $17,150 but not over $23,600 $686 plus 4.5% of excess over
10 $17,150
11 Over $23,600 but not over $27,900 $976 plus 5.25% of excess over
12 $23,600
13 Over $27,900 but not over $161,550 $1,202 plus 5.5% of excess over
14 $27,900
15 Over $161,550 but not over $323,200 $8,553 plus 6.00% of excess over
16 $161,550
17 Over $323,200 but not over $18,252 plus 6.85% of excess over
18 $2,155,350 $323,200
19 Over $2,155,350 but not over $143,754 plus 9.65% of excess over
20 $5,000,000 $2,155,350
21 Over $5,000,000 but not over $418,263 plus 10.30% of excess over
22 $25,000,000 $5,000,000
23 Over $25,000,000 $2,478,263 plus 10.90% of excess
24 over $25,000,000
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD08512-01-5
A. 5435 2
1 (vii) For taxable years beginning after two thousand [twenty-seven]
2 twenty-five the following rates shall apply:
3 If the New York taxable income is: The tax is:
4 Not over $17,150 4% of the New York taxable income
5 Over $17,150 but not over $23,600 $686 plus 4.5% of excess over
6 $17,150
7 Over $23,600 but not over $27,900 $976 plus 5.25% of excess over
8 $23,600
9 Over $27,900 but not over $161,550 $1,202 plus 5.5% of excess over
10 $27,900
11 Over $161,550 but not over $323,200 $8,553 plus 6.00% of excess
12 over $161,550
13 Over $323,200 but not over $18,252 plus 6.85% of excess
14 $2,155,350 over $323,200
15 Over $2,155,350 but not over $143,754 plus [8.82]
16 $5,000,0009.65% of the excess over
17 $2,155,350
18 Over $5,000,000 but not over$418,263 plus 10.80% of excess
19 $25,000,000over $5,000,000
20 Over $25,000,000$2,578,263 plus 11.40% of excess
21 over $25,000,000
22 § 2. Clauses (vi) and (vii) of subparagraph (B) of paragraph 1 of
23 subsection (b) of section 601 of the tax law, as amended by section 2 of
24 subpart A of part A of chapter 59 of the laws of 2022, are amended to
25 read as follows:
26 (vi) For taxable years beginning in two thousand twenty-three [and
27 before two thousand twenty-eight] the following rates shall apply:
28 If the New York taxable income is: The tax is:
29 Not over $12,800 4% of the New York taxable income
30 Over $12,800 but not over $17,650 $512 plus 4.5% of excess over
31 $12,800
32 Over $17,650 but not over $20,900 $730 plus 5.25% of excess over
33 $17,650
34 Over $20,900 but not over $107,650 $901 plus 5.5% of excess over
35 $20,900
36 Over $107,650 but not over $269,300 $5,672 plus 6.00% of excess over
37 $107,650
38 Over $269,300 but not over $15,371 plus 6.85% of excess over
39 $1,616,450 $269,300
40 Over $1,616,450 but not over $107,651 plus 9.65% of excess over
41 $5,000,000 $1,616,450
42 Over $5,000,000 but not over $434,163 plus 10.30% of excess over
43 $25,000,000 $5,000,000
44 Over $25,000,000 $2,494,163 plus 10.90% of excess over
45 $25,000,000
46 (vii) For taxable years beginning after two thousand [twenty-seven]
47 twenty-five the following rates shall apply:
48 If the New York taxable income is: The tax is:
49 Not over $12,800 4% of the New York taxable income
50 Over $12,800 but not over $512 plus 4.5% of excess over
51 $17,650 $12,800
52 Over $17,650 but not over $730 plus 5.25% of excess over
53 $20,900 $17,650
54 Over $20,900 but not over $901 plus 5.5% of excess over
55 $107,650 $20,900
A. 5435 3
1 Over $107,650 but not over $5,672 plus 6.00% of excess
2 $269,300 over $107,650
3 Over $269,300 but not over $15,371 plus 6.85% of excess
4 $1,616,450 over $269,300
5 Over $1,616,450 but not over $107,651 plus [8.82%]
6 $5,000,0009.65% of excess over
7 $1,616,450
8 Over $5,000,000 but not over$434,163 plus 10.80% of excess
9 $25,000,000over $25,000,000
10 Over $25,000,000$2,594,163 plus 11.40% of
11 excess over $25,000,000
12 § 3. Clauses (vi) and (vii) of subparagraph (B) of paragraph 1 of
13 subsection (c) of section 601 of the tax law, as amended by section 3 of
14 subpart A of part A of chapter 59 of the laws of 2022, are amended to
15 read as follows:
16 (vi) For taxable years beginning in two thousand twenty-three [and
17 before two thousand twenty-eight] the following rates shall apply:
18 If the New York taxable income is: The tax is:
19 Not over $8,500 4% of the New York taxable income
20 Over $8,500 but not over $11,700 $340 plus 4.5% of excess over
21 $8,500
22 Over $11,700 but not over $13,900 $484 plus 5.25% of excess over
23 $11,700
24 Over $13,900 but not over $80,650 $600 plus 5.50% of excess over
25 $13,900
26 Over $80,650 but not over $215,400 $4,271 plus 6.00% of excess over
27 $80,650
28 Over $215,400 but not over $12,356 plus 6.85% of excess over
29 $1,077,550 $215,400
30 Over $1,077,550 but not over $71,413 plus 9.65% of excess over
31 $5,000,000 $1,077,550
32 Over $5,000,000 but not over $449,929 plus 10.30% of excess over
33 $25,000,000 $5,000,000
34 Over $25,000,000 $2,509,929 plus 10.90% of excess over
35 $25,000,000
36 (vii) For taxable years beginning after two thousand [twenty-seven]
37 twenty-five the following rates shall apply:
38 If the New York taxable income is: The tax is:
39 Not over $8,500 4% of the New York taxable income
40 Over $8,500 but not over $11,700 $340 plus 4.5% of excess over
41 $8,500
42 Over $11,700 but not over $13,900 $484 plus 5.25% of excess over
43 $11,700
44 Over $13,900 but not over $80,650 $600 plus 5.50% of excess over
45 $13,900
46 Over $80,650 but not over $215,400 $4,271 plus 6.00% of excess
47 over $80,650
48 Over $215,400 but not over $12,356 plus 6.85% of excess
49 $1,077,550 over $215,400
50 Over $1,077,550 but not over $71,413 plus [8.82%]
51 $5,000,0009.65% of excess over
52 $1,077,550
53 Over $5,000,000 but not over$449,929 plus 10.80% of excess
54 $25,000,000over $25,000,000
55 Over $25,000,000$2,609,929 plus 11.40% of excess
56 over $25,000,000
A. 5435 4
1 § 4. Subparagraph (B) of paragraph 1 of subsection (d-4) of section
2 601 of the tax law, as added by section 3 of subpart B of part A of
3 chapter 59 of the laws of 2022, is amended to read as follows:
4 (B) If New York adjusted gross income is greater than twenty-five
5 million dollars, the supplemental tax due shall equal the difference
6 between the product of [10.90] 11.40 percent and New York taxable income
7 and the tax table computation on the New York taxable income set forth
8 in paragraph one of subsection (a) of this section.
9 § 5. Subparagraph (B) of paragraph 2 of subsection (d-4) of section
10 601 of the tax law, as added by section 3 of subpart B of part A of
11 chapter 59 of the laws of 2022, is amended to read as follows:
12 (B) If New York adjusted gross income is greater than twenty-five
13 million dollars, the supplemental tax due shall equal the difference
14 between the product of [10.90] 11.40 percent and New York taxable income
15 and the tax table computation on the New York taxable income set forth
16 in paragraph one of subsection (b) of this section.
17 § 6. Subparagraph (B) of paragraph 3 of subsection (d-4) of section
18 601 of the tax law, as added by section 3 of subpart B of part A of
19 chapter 59 of the laws of 2022, is amended to read as follows:
20 (B) If New York adjusted gross income is greater than twenty-five
21 million dollars, the supplemental tax due shall equal the difference
22 between the product of [10.90] 11.40 percent and New York taxable income
23 and the tax table computation on the New York taxable income set forth
24 in paragraph one of subsection (c) of this section.
25 § 7. This act shall take effect immediately.
