New York Senate Bill S00953

New York 2025-2026 Regular Session

• Introduced: 1/8/25
• Refer: 1/8/25

Caption

Raises the tax rate on corporate income; increases the state conformity to federal taxation of corporate profit shifting; imposes an additional tax on individual business income in response to federal tax benefits for pass-through business income.

Summary

S00953 would significantly increase taxes on certain business and business-related income in New York. It raises the corporate franchise tax rate for larger taxpayers beginning in 2026, with higher marginal rates applying to business income above specified thresholds. The bill also changes how New York treats certain foreign-derived corporate income, including global intangible low-taxed income (GILTI) and exempt controlled foreign corporation (CFC) income, by broadening the amount included in the tax base or apportionment calculation. The bill further reduces the pass-through entity tax credit from 100 percent to 75 percent of a partner, member, or shareholder’s share of that tax, and creates a new additional tax on individual income tied to the federal Section 199A deduction for qualified business income. That new tax would generally apply to taxpayers above the federal threshold amount, plus an added cushion, and would effectively recapture the state tax benefit associated with the federal pass-through deduction. The measure takes effect immediately and applies to taxable years beginning on or after that date.

Impact

The bill would amend multiple provisions of the New York Tax Law, including corporate franchise tax rules, apportionment rules for C corporations, the pass-through entity tax credit, and individual income tax provisions. Its practical effect would be to raise state revenue by increasing tax liability for larger corporations, limiting favorable treatment of certain offshore or low-taxed foreign income, reducing the value of the pass-through entity tax credit, and imposing a new surcharge-like tax on higher-income individuals who benefit from the federal Section 199A deduction. Affected parties would include large C corporations, multistate and multinational businesses, owners of pass-through entities, and higher-income individual taxpayers with qualified business income.

Sentiment

Based on the bill text and caption, the measure appears to be framed as a revenue-raising and anti-tax-avoidance proposal aimed at corporations and business owners. No committee transcripts or recorded votes were provided, so there is no documented floor or committee debate to gauge broader legislative sentiment. The bill’s sponsors and framing suggest support for increasing taxes on profitable businesses and recapturing benefits tied to federal business tax preferences.

Contention

The main points of contention are likely to be the higher corporate tax rates, the expanded treatment of GILTI and exempt CFC income, the reduction in the pass-through entity tax credit, and the new tax on income associated with the federal Section 199A deduction. Supporters would likely view these changes as closing loopholes and increasing fairness in the tax system, while opponents would likely argue that the bill raises costs for businesses, reduces competitiveness, and may discourage investment or job creation. Because no discussion transcript or vote history is available, specific named opponents or supporters cannot be identified from the provided materials.