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New York Decides to Abandon "iPod Tax"

In what WCBS-TV calls a "gigantic flip-flop," New York Governor David Paterson announced that his administration has called off a slew of new taxes aimed at the entertainment industry, including a tax on online music purchases.

Last December, Tom's Guide reported that Gov. Paterson was preparing a budget that would include new taxes on digitally distributed music, as well as movie tickets, cab rides, soda, alcohol, tobacco and cable/satellite television. While Governor Paterson once said "this is where we are," his administration has performed a complete 180 on the matter. "It really has disturbed a lot of New Yorkers," said Gov. Paterson. "They just see it as inconvenient and frustrating that when they try to get to some of their leisure areas that they are taxed as well."

While iPod and iRiver fans in the Empire State are breathing a sigh of relief, New York is still mired in debt. Unofficial projections put the states' deficit at approximately $14 billion. If these new luxury taxes had been imposed, about $1.3 billion in taxes would have been collected in 2009 alone. Furthermore, the elimination of such taxes leaves New York City with $150 million hole to deal with. Such a leak may require cuts in different sector across the city, or new taxes just for the city itself. However, with Federal government bailout money on the way, the Governors' office saw the new taxes as a highly contentious issue and a strain on the middle class. "We have always believed that working families are the backbone of the state," said NY Assembly Speaker Sheldon Silver, "and as such they need relief from the ever-rising cost of living in New York State."

Governor Paterson's decision to abandon taxes on such leisure items will probably do better by the state of New York in the long run. When such taxes were initially proposed, many in the state legislature feared it would drive New Yorkers to shop in New Jersey, leaving parts of New York (specifically New York City) in quite a predicament. While downloadable content is safe for now, New York does draw revenue from other web-based sources, including its sales tax on websites like Amazon.

  • Startingline13
    As a New Yorker myself, I was furious when I heard about this. Patterson is trying to tax us to death, as if our taxes aren't high enough at the moment. You almost feel trapped to the point where anything you want to do, leisure or not, will be taxed greatly.
    They Wonder why so many New Yorkers move from the state and head down south, but who can blame them? You can buy a house for half the price and twice the size as a place in New York.
    Reply
  • Startingline13
    As a New Yorker myself, I was furious when I heard about this. Patterson has been trying to tax us to death for anything and everything, yet gives members of his office pay increases.

    Who can blame all of the people who are moving from New York to the states down south? You can get a home down there for half the price yet twice the size.
    Reply
  • Trialsking
    "gigantic flip-flop,"

    Can we also call this a giga-flop!?!?!
    Reply
  • AdamB5000
    When will all forms of government learn that raising taxes is not an answer to balance budgets? Decrease spending and live within your means. That's the ticket to a balanced budget. If you have increase revenues you WILL have increased spending. That has always and will always be the case.

    "We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle." -Winston Churchill
    Reply
  • outacontrolpimp
    Maybe they wouldnt be in such a disaster if they wouldnt have bought that new yankee stadium, that stadium came out of the new york city budget. nice?
    Reply
  • Warsaw
    AdamB5000"We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle." -Winston Churchill
    That quote made me Lol, love it =).
    Reply
  • Startingline13
    Yeah that new Yankee Stadium is a rip off. And you know who foots the bills for the insane salaries the players make? New Yorkers.

    We have no money to pay for a new stadium, yet we can pay A-roid 24 million a year. You want to come watch us play? Fork over the cash for the field.
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  • You folks do know that NY is paying very little for the stadium, right? Here's a tip... when you generate bonds for a stadium it is not a gift, those need to be repaid by the Yankees to the city of NY. The key expense is the low/zero interest... that is a real, and not insignificant expense; but don't confuse it with the loons who think the Yankees are getting 800Mil for the stadium.

    And NY'ers are not paying AROD's salary! It's not like your tax money is going there... if folks are outraged over the salaries, then they'll stop going to games and watching TV and listening on the radio. Must we create villains to ensure that NY'ers are victims.

    Here's a tip - stop electing corrupt politicians. Stop electing Democrats who thinking spending is the way to fix things. Complain about giving 1.4Bil to the DUBAI and a company (Global Foundries) that is chartered in the Caman islands (to get beneficial tax treatment!) for creation of ~1400 jobs (essentially 1mil/job created).

    Stop electing people who spend like drunken sailors and then you can complain about a baseball team.
    Reply
  • demonhorde665
    startingline13As a New Yorker myself, I was furious when I heard about this. Patterson is trying to tax us to death, as if our taxes aren't high enough at the moment. You almost feel trapped to the point where anything you want to do, leisure or not, will be taxed greatly.They Wonder why so many New Yorkers move from the state and head down south, but who can blame them? You can buy a house for half the price and twice the size as a place in New York.try three times the size

    I'm in texas our hosue costed us around 80,000 dollars and that was WITH 1.5 acres of land, my mom bought a trailer with 7.6 acres of land, with a pond on it (which she now rents out for 400/month) ,she paid 46,000 dollars for it. My neihbor's son works in new york and once told me he RENTS an apartment at 5,000/month. givien this fugure i imagine trher is no way in hell you could get a 7 acre plot with even a shack on it in NY for 46, thousand.
    if youw ant to come down here and lvie you are welcome ! I wouldnt want to live in NY myself because of the cost.

    P.S. keep in mine i live in the boonies, sounthern cities are a bit mroe expensive living than it is out here but i imagine still not as bad as up north cities.
    Reply
  • demonhorde665
    getaclueYou folks do know that NY is paying very little for the stadium, right? Here's a tip... when you generate bonds for a stadium it is not a gift, those need to be repaid by the Yankees to the city of NY. The key expense is the low/zero interest... that is a real, and not insignificant expense; but don't confuse it with the loons who think the Yankees are getting 800Mil for the stadium.And NY'ers are not paying AROD's salary! It's not like your tax money is going there... if folks are outraged over the salaries, then they'll stop going to games and watching TV and listening on the radio. Must we create villains to ensure that NY'ers are victims.Here's a tip - stop electing corrupt politicians. Stop electing Democrats who thinking spending is the way to fix things. Complain about giving 1.4Bil to the DUBAI and a company (Global Foundries) that is chartered in the Caman islands (to get beneficial tax treatment!) for creation of ~1400 jobs (essentially 1mil/job created).Stop electing people who spend like drunken sailors and then you can complain about a baseball team.

    hmmm it wasn't the democrats that wasted the largest fortune ever on a war with a small insignificant nation that was never really a threat to us. and then turned around and used the only resource generated by that war to line their own pockets with cash while only giving that countries people a small portion of that money.
    Reply