New York Governor Hochu put forward the “Inflation Refund” plan on December 9th in order to help people cope with the rising cost of living. Under this plan, households with annual incomes below $300,000 will receive a $500 tax refund check, while individuals with incomes below $150,000 will receive a $300 tax refund check. The state estimates that 8.6 million residents of New York will benefit from this initiative.
On Monday, Hochu announced the “Affordability Agenda 2025” at Co-Op City in the Bronx, New York City. This proposal will be the first to be presented in her State of the State address on January 14th next year and will be included in the budget for the 2026 fiscal year (from April next year to March the following year), to be submitted to the state legislature for review.
Hochu stated that due to inflation, New York State’s sales tax revenue has reached an unprecedented surplus. Therefore, returning this money to middle-class families is crucial to putting money back in the pockets of the people. The initial distribution will include a maximum of $500 inflation refund checks per household to assist millions of hardworking New Yorkers. She also emphasized that the cost of living is still too high and the burden on the people needs to be alleviated.
The proposed inflation refund by Hochu is a one-time direct payment. Families with annual incomes below $300,000 will receive $500 in tax refunds, while individuals with incomes below $150,000 will receive $300. An estimated 8.6 million residents statewide will qualify for the refund, with 3.645 million residing in New York City. The total refund amounts to $3 billion, funded by the surplus state sales tax revenue. Once the proposal is approved by the state legislature, distribution to all residents will begin in the fall of next year.
According to Gothamist, Andrew Rein, the Chairman of the non-profit watchdog organization Citizens Budget Commission (CBC), criticized Hochu’s proposal for missing the point. Rein stated that while a one-time tax refund may seem appealing, what New Yorkers truly need is tax cuts to enhance affordability and competitiveness.
Carolyn Martinez-Class, the manager of the “Invest in Our New York” campaign advocating for increased taxes on the wealthy, praised Hochu for recognizing the affordability crisis faced by New Yorkers. However, she emphasized that President-elect Trump has stated his intention to cut federal budgets upon taking office. Therefore, New York State must go “beyond one-time payments” and take concrete measures to address the affordability crisis and narrow the wealth gap across the state.
Before Hochu announced this refund plan, New York City Mayor Adams had only recently proposed a “tax cut for the working class” last week, aiming to eliminate or reduce the personal income tax for working families in New York City.