Governor’s Budget: Media Jobs Tax Credit & No Advertising Taxes

We finally have a budget bill in New York. The following highlights the sections of the recently passed Governor’s budget that will have an impact on local broadcasting.

No Advertising or Digital Taxes: There were no advertising or digital advertising taxes in the budget.  Although digital tax legislation has been introduced.  This will become an issue as New York looks for revenue to make up for cuts in federal grants.

Media Jobs Tax Credit: Last year, we lobbied successfully for a media jobs tax credit to help support local broadcast journalism.  Under the program, a station may obtain a $5000 tax credit per year for every new employee hired by the station.  For existing employees, a station may obtain a tax credit amounting to 50% of an employee’s salary up to $50,000.  In other words, a station may obtain a maximum credit for existing employees, which would be $25,000 per employee.  A station may earn up to $300,000 in tax credits per year. The station must be licensed to communities located in New York State.

Unfortunately, stations owned by publicly traded companies remain excluded from participating in the tax credit program.  Our request to allow publicly traded broadcast companies to participate in the media jobs tax credit program was not accepted.  Only privately held broadcast stations may participate in the tax credit program.  This means most TV stations and many radio stations will not be eligible for the tax credit program.  We will continue to press this issue.   

We were able to obtain language clarifying that a broadcast owner with stations in different markets may obtain a tax credit for stations serving separate markets.  Even if an owner files a single tax return, it can obtain credits for more than one station provided the station serves a separate geographic market.  Thus, if you own stations in Rochester, Syracuse, and New York, you can obtain a tax credit for one station in each market. 

We are working through the details of the budget language this week.  The tax credits will not begin until Empire State Development adopts rules.  We will be working with Empire State Development to help craft the rules that will govern the tax credit. 

NYC Metro Increase in the Payroll Mobility Tax: This applies to businesses located in the Metropolitan Commuter Transportation District.  (New York City Metro area.) The enacted budget increases the Payroll Mobility Tax on businesses with annualized payrolls above $10 million, cuts the tax for businesses with payrolls under $1.75 million, and exempts local governments and community colleges outside of New York City.  Businesses in New York City (Zone 1) with payrolls above $10 million will see an increase from .6% to .895%.  Businesses in the counties of Dutchess, Nassau, Orange, Putnam, Rockland, Suffolk, and Westchester (Zone 2) with payrolls above $10 million will see an increase from .34% to .635%.