Under a budget proposed by Gov. David A. Paterson Tuesday, the state would charge sales tax on activities that include downloading music, attending a ballgame and getting a massage.
Paterson’s executive budget included 88 fees, 10 fines and 39 tax changes that would bring in over $5 billion next year.
“The governor feels these fees are fair, reasonable and necessary to balance this budget,” said spokesman Errol Cockfield. He said the administration looked at areas where fees had remained the same for many years, where costs of services had gone up, and where revenue could be brought in quickly, “without unduly burdening our citizens, especially the most vulnerable.”
If the Legislature approves, the state would begin taxing hair salons, credit rating services, cable and satellite television and radio, movies and sporting events. Sales tax would be charged when downloading music, movies, photographs and games. Taxes would increase for cigars and malt beverages, as well as car rentals and limousines. The cost of vehicle registration and licensing would go up 25 percent.
The plan would eliminate the sales tax exemption on clothing and footwear under $110, and creates a luxury goods tax for expensive cars, yachts, jewelry and noncommercial aircraft.
State parks fees for camping, rentals, golf and marina use also would go up.
Senate Majority Leader Dean Skelos (R- Rockville Centre) opposed the increases and said, “It’s my hope we will be able to eliminate a number of these fees and taxes, especially those that impact the everyday working family person who just can’t make ends meet right now.”
The budget presentation said many states already collect taxes on entertainment, and New York City collects sales tax on personal services.
John Vargas, who owns Atlantic Massage Therapy in Merrick, said a sales tax on massage therapy is tantamount to exacting a tribute for self-care. “People are going to feel like the government is taking the money that’s for their wellness,” he said. “Are they going to start taxing doctors’ co-pays, too?”
Staff writer Laura Rivera, on Long Island, also contributed to this story.
The following are among the taxes and fees that Gov. David A. Paterson is proposing in his 2009-2010 budget.
Makes personal services (such as beauty, barbering, manicure, pedicure, massage, health salon or gymnasium services) and credit rating and reporting services subject to sales tax statewide. Currently, only New York City sales tax applies to these services.
Imposes a sales tax on entertainment-related consumer spending, including, but not limited to, movie theaters and sporting events.
Imposes state and local sales tax on purchases of prewritten software, digital audio, audio-visual and text files, digital photographs, games, and other electronically delivered entertainment services.
Imposes a sales tax on transportation-related consumer spending, including, but not limited to, taxis, limousines and buses.
Imposes sales tax on television and radio services provided by cable, satellite or other similar means.
Imposes an additional 18 percent rate of sales and compensating use taxes on fruit drinks that contain less than 70 percent of natural fruit juice and nondietetic soft drinks, sodas and beverages.
Modifies the taxation of cigars to impose a tax of $0.50 per cigar to simplify the administration of the tax. The current tax is equal to 37 percent of the wholesale price or approximately 34 cents per cigar.
Increases the excise tax on wine and beer to approximately the average of surrounding states. The tax on wine would increase from 18.9 cents per gallon to 51 cents per gallon, and the beer tax would increase from 11 cents per gallon to 24 cents per gallon.
Increases registration fees for most vehicles and fees for distinctive plates by 25 percent. The average vehicle registration fee will increase from $44 to $55.
Increases original and renewal driver’s license fees by 25 percent. A standard eight-year renewal will now cost $62.50, up from $50.
Creates a new fee of $10 for filing a paper personal income tax return, which will encourage individuals to file via the Internet.
Establishes a new marine fishing license at a cost of $19 for state residents and $40 for out-of-state individuals.
Raises administrative fees for various park activities, such as camping, cabin rentals, golf, and marina usage, as well as for Empire Passports, passes and permits.
Increases the cigarette and tobacco retailer fee from $100 to $1,000 for retailers with gross sales of less than $1 million, to $2,500 for retailers with gross sales of $1 million but less than $10 million, and to $5,000 for retailers with gross sales of $10 million or more.
Imposes an additional sales tax on luxury goods. This proposal would impose a 5 percent tax on the price of the following items in excess of the following thresholds: $60,000 for cars, $200,000 for vessels (including but not limited to yachts); $20,000 for jewelry and furs; and $500,000 for noncommercial aircrafts.
Increases the biannual physician registration fee from $600 to $1,000.
