The Senate-approved tax bill, if made into law, will bleed residents of New York and its surrounding areas. According to independent economic analysis, prices of homes in New York City could go south by as much as 10 percent. The burden of regional taxes may go up. This will complicate the efforts of companies to attract much needed talented and skilled workers. Local and state governments will find it much tougher to finance infrastructure upgrades and transit system improvements.
Bad news for everyone
The passage of the bill also portends a dark outcome for federal program cuts which goes to helping immigrants and residents having low incomes. The elderly would also be negatively affected. Many would not be able to afford to live in New York City. There would also be the elimination of deductions available for local and state income taxes. The property tax deduction will be capped at $10,000. This would not matter to about two-thirds of the national households which fall under standard deduction, which will be almost doubled as an effect of the bill. In New York City, however, high local and state taxes could change equations. The residents of prosperous suburban counties and Manhattan mostly itemize deductions. A number of them could see instant tax increases.
Taxes and two bill versions
The bill will negatively affect not only homeowners but all New York residents. Most city residents would enjoy tax slashes in the near term, but as per analysts, the quantum of taxes will only go north afterward. According to Bill de Blasio, the Mayor of New York, the impact on residents will be substantial. Other than higher taxes, city services would be cut due to the tax plan. The mayor said that his administration has tried to make New York, one of the most pricier cities in the world, a more affordable metropolis to live in by offering paid sick leaves and public prekindergarten. The bill formulated by the federal government has made the situation much worse.
There are two versions of the bill at present. One was passed by the Senate and one by the House. The two are considerably different. These differences must be resolved by a conference committee prior to the bill being presented to the United States President. New York has much to lose by the House Bill, including tax-exempt bonds elimination which the metropolis, along with a number of other American cities, have utilized to construct affordable housing schemes.