The new year will bring a range of tax changes for local residents, with relief coming from the state in the form of more than $1.9 billion in new state tax cuts, but, simultaneously, an estimated nine percent increase in county property taxes.

This year's state budget includes more than 30 tax cuts, such as a program to reduce the school property tax burden, reduction of the so-called income tax "marriage penalty," and tax credits for college tuition. The cuts come as the state experiences a major surplus. The county budget approved for 2001 however, includes an approximately nine percent increase in the county portion of residents' property taxes, which amounts to about $95 per household. The tax increase was approved as part of a 4-year plan to deal with the county's deficit. The four-year county plan also calls for a 5 percent increase each year from 2002 to 2004.

On the state level, the tax cuts, which took effect Jan. 1, include the following:

With the continuation of STAR, a program of reducing school property taxes being phased in over four years, this year, homeowners will see a 27 percent reduction in school property taxes. This amounts to several hundred dollars for the average homeowner.

Two other pieces of the tax-cut package which are expected to have a major impact for Westbury's middle class families are a reduction in the so-called "marriage penalty" and a plan to make college education more affordable. Traditionally, the "marriage penalty" has impacted families by making the standard income tax deduction for a married couple filing a joint tax return lower than it would have been if each wage earner had filed separately as a single person. This year, the marriage penalty will be reduced for New York's married taxpayers by increasing the standard deduction for married couples who file a joint return, from $13,000 to $14,600. The move is expected to save taxpayers more than $200 million when fully implemented.

The plan to ease the financial burden of higher education for the college bound and their families comes in the form of the College Tuition/Tax Deduction Credit. The measure gives taxpayers the option of claiming an itemized deduction or receiving a tax credit to help offset their college tuition expenses, and is expected to save taxpayers more than $200 million annually when it becomes fully effective.

Also included in the package are an increase in the Earned Income Tax Credit (EITC), an extension of the Power for Jobs program, phasing out of the Gross Receipts Tax (GRT), and a measure to encourage the creation of environmentally sensitive buildings.

EITC is a program which is administered by both the federal and state governments. It provides a tax incentive to the working poor, by providing a tax credit to low-income parents. This year, New York State will increase it from 22.5 percent of the federal credit to 25 percent, giving $25 million more to low-income families. As part of a phase-in plan, the state plans to gradually raise EITC to 30 percent of the federal credit.

The Power for Jobs Program is aimed at promoting job creation by providing low-cost power to businesses that create and retain jobs. It will be extended for three more years, and will provide an increased amount of low cost power, saving businesses $33.6 million in 2001-02. The program has already helped to create and retain more than 270,000 jobs since it was started in 1997, according to state officials.

The elimination of the GRT is aimed at reducing the cost of energy for residential and business customers. A phase-out program will begin in January, and is expected to eventually save ratepayers more than $330 million.

The Green Buildings program provides tax credits for the construction and rehabilitation of environmentally sensitive or so-called "green buildings."

Commenting on the state tax cuts last week, Senator Michael Balboni, who represents Westbury, Old Westbury, New Cassel and Carle Place, stated, "When the new year begins, new tax cuts will take effect that help more New Yorkers afford college, transition from welfare to work, and reduce business and residential energy costs." He added, "New York continues to be a tax-cut leader, helping to create new jobs and making our state more economically competitive."