Spitzer's Christmas Present

Just in time for Christmas or Chanuka or Kwanzaa, Governor Spitzer has decided to deliver the state's taxpayers a gift-wrapped lump of coal in the form of a more than 8% tax increase — at least on a rapidly expanding set of transactions that affects just about everyone. It's a sales tax that would apply to purchases by New Yorkers of goods on Amazon.com. It could also extend to other Internet retailers that had been exempt from state and local taxes because the companies that operated them lacked a physical presence in New York state. Our Joseph Goldstein has the particulars at page one.

The governor's aides explain that the change in tax policy is expected to raise hundreds of millions of dollars in revenues for the state, which faces projected budget shortfalls in the billions of dollars. In the face of widespread opposition to his plan to grant New York state drivers licenses to illegal immigrants, Mr. Spitzer has lately been making the point that leadership sometimes requires doing what is unpopular. But the budget gap — and this tax increase — is the consequence of precisely Mr. Spitzer's failure to risk unpopularity by reining in education spending.

The new tax would be an abrogation of one of Mr. Spitzer's most basic campaign planks. Mr. Spitzer got elected governor in part by insisting he wouldn't raise taxes. "What I think is what I say and what I say is what I do," Mr. Spitzer promised in a September 26, 2006, request, "There will be no tax increase in a Spitzer administration." Read his lips. Those who thought Mr. Spitzer was different were wrong. There just seems to be something about a Democrat that spells tax increases.

The voters were warned by Mr. Spitzer's Republican opponent, John Faso, and even by Mayor Giuliani, who prophetically warned, "It's hard to promise all those tremendous spending increases and not turn around as many Democrats do right after they are elected. They say they are not going to raise taxes, and then they say, 'Oh, my God. I just have to.'" Somehow Mr. Spitzer wasn't willing to risk this kind of unpopularity while he was running for office.

With New York's state and local tax burden already among the highest and the upstate economy in such a state that Mr. Spitzer has likened it to Appalachia, what in the world is the governor doing putting through the kind of sales tax that he's toying with? What's needed are tax cuts, not tax increases. That would put more money in the pockets of individual New Yorkers, rather than in the hands of the politicians in Albany, who, for all their fabled dysfunctionality, somehow always seem to be able to figure out a way to squeeze more money out of the taxpayers.