Email
Password
Remember meForgot password?
    Log in with Twitter

article imageTaxpayers to subsidize New York's minimum wage increase

By Andrew Moran     Mar 28, 2013 in Politics
New York - The state of New York’s Senate voted in favor of a $136 billion budget on Wednesday that includes a hike in the minimum wage over a three-year period and a $350 rebate to families with children.
The Assembly will vote on the budget Thursday and will make it the third consecutive year that the state has met its Apr. 1 deadline.
The minimum wage will increase to $9 per hour by the year 2016, but the taxpayers are footing the bill. At the end of the legislation, it includes a measure called the “minimum wage reimbursement credit,” a credit that reimburses employers for part of the difference in wages from the current $7.25 minimum wage, according to Newsday.
Once the minimum wage hits the $9 mark, employers would dole out the 40 cents and the taxpayers would be forced to fork over $1.35 of the additional $1.75 per hour workers are paid. However, some anti-poverty advocates say there will be unintended consequences.
Employers that include fast-food chains and big-box department stores will receive tax credits for seasonal employees who are aged 16 to 19 and are still in school. It has been argued that this could hurt adult workers.
“We're paying Walmart to fire people,” said Democratic State Senator Jose Peralta.
Full costs of the program will not be revealed until after the budget garners legislative approval. Those close to the situation, according to the Associated Press, estimate that it is roughly between $20 million and $40 million with no cap on the total price tag.
Also, it is believed that employers could eventually let go their older employees in favor of the teenagers because businesses could earn as much as $2,800 as of 2016. New York Governor Andrew Cuomo and the Republican leadership stated that the credit was a compromise in order to raise the incomes of millions of New Yorkers.
“This budget balances the needs of families and workers who have waited far too long for a minimum wage hike with business owners looking to grow in this still fragile economy," said Cuomo spokesperson Rich Azzopardi.
Syracuse.com reports that institutes, including the Empire Center, say the tax credit could very well encourage businesses to hire teenagers and cap their wages at the minimum wage. The group stated that by raising the minimum wage to at least $8.75, it could generate 7,300 jobs.
More about New york, Minimum wage, Andrew cuomo, Taxpayers, minimum wage reimbursement credit
More news from
Latest News
Top News