(The Center Square) — New York’s high taxes, onerous regulations and rising cost of doing business are driving away employers and contributing to population decline, according to a new independent report.
The report by the Public Policy Institute of New York State, released Monday, found that 72% of 500 employers surveyed don’t think the state’s economic conditions are good, and only 21% believe the state is on the right track. The group said its analysis suggests that New York has lost its competitive edge, ranking 50th in the nation for both outmigration and taxation during the 2020-2022 period covered by the report.
The Blueprint for New York – Creating a Roadmap for Change report blamed the state’s “prohibitive” regulatory and legal environment, high taxes, and expensive worker’s compensation and health insurance claims that it claimed are holding back growth and stifling new investment and innovation. Palestinian.
“While New York had a great run for more than a century, economic and qualitative data demonstrate that as a state, New York isn’t losing its edge, but has lost its edge in competitiveness relative to other states,” they wrote. “In many cases, New York’s economic performance and population metrics more closely resemble the economic and demographic trends of Louisiana or Michigan as opposed to some of the fastest-growing states, particularly Texas and Florida.”
Many business leaders surveyed for the report said New York’s taxes and regulations make it too expensive and difficult to run a business. The Empire State has more 300,000 regulations on the books, and employers surveyed wanted fewer state and local regulations and lower business taxes from the state, according to the report.
In 2023, New York’s effective state business tax rate was 5.9%, making it the ninth-highest in the nation, the report’s authors noted. The state also ranks poorly for individual income, sales, property, and unemployment insurance taxes. It has the fourth-highest percentage of housing-burdened households in the country, with 38.6% of households spending more than 30% of their income on housing.
Those factors have contributed to outmigration, with New York losing more domestic taxpayers than any other state from 2020 to 2022, according to the report, as residents fled to New Jersey, Florida, and other low-tax states.
New York also leads the nation in new legislation introduced, the report noted, with the Democratic-controlled Legislature filing 24,195 bills in the previous legislative session — five times the national average.
The report said surveys of respondents and focus group participants “cited not only the sheer volume of regulation in the state compared to others, but the inability to keep up with changes given the rapid pace of new legislation being introduced without thoughtful consideration and insight from subject matter experts on related issues.”
“This regulatory environment creates challenges for existing New York-based businesses and reinforces the reputation of the state as a difficult place to do business,” they wrote.
The institute’s report — commissioned by The Business Council of New York State and the New York State Economic Development Council — is the latest to highlight the impact of New York’s tax burden on outmigration and investment.
Democratic Gov. Kathy Hochul has blamed a lack of housing as the primary reason New Yorkers are fleeing the state, making the case for expanding housing stock and making existing homes more affordable.
But Republicans have long argued that New York’s outmigration is being driven largely by the state’s highest-in-the-nation tax burden, a business sector struggling under excessive regulations and rising labor costs.
