New York Senate Bill S09189

New York 2025-2026 Regular Session

• Introduced: 2/12/26
• Refer: 2/12/26

Caption

Increases tax rates imposed on unincorporated businesses and corporations in New York city upon adoption of a local law by the local legislative body of the city of New York.

Summary

This bill would authorize New York City to increase certain business tax rates beginning with taxable years on or after January 1, 2026, if the city adopts a conforming local law. It amends state enabling law and multiple provisions of the New York City Administrative Code to raise the unincorporated business tax rate on income above $5 million, increase the general corporation tax rate, and increase the banking corporation and financial corporation tax rates. The bill also updates related credit formulas and scaling factors so that the higher rates are reflected in the tax credit limitations and graduated rate structures used for certain businesses. The measure is structured as a conditional authorization: the state changes do not fully take effect unless the New York City local legislative body ratifies and approves the specified amendments by local law. Several sections must be adopted together, including the paired changes for unincorporated businesses, general corporations, banking corporations, and financial corporations. The bill is retroactive to January 1, 2026 for the affected taxable years once the local law is enacted, and it requires the city to notify the legislative bill drafting commission so the official law database can be updated.

Impact

The bill would amend chapter 772 of the Laws of 1966 and multiple sections of the New York City Administrative Code, changing the tax rates and credit calculations applicable to businesses operating in New York City. It would directly affect unincorporated businesses, corporations, banking corporations, financial corporations, and certain taxpayers claiming credits tied to partnership or unincorporated business income. Because the bill is contingent on local adoption, it expands the city’s taxing authority while preserving local control over whether the rate increases are implemented.

Sentiment

Based on the bill text and available context, the measure appears to be a revenue-raising proposal with no recorded committee transcript or vote history in the provided materials. The sponsor list suggests support from members aligned with progressive fiscal policy, and the bill’s structure indicates an intent to increase city tax collections from higher-income business activity. With no opposition statements or recorded votes included, the overall sentiment in the available record is neutral-to-supportive, but not documented in debate form.

Contention

The main point of contention is likely the tax increase itself, especially the higher rates on businesses with income above specified thresholds and on financial corporations, which are often sensitive subjects in New York City tax policy. Another potential issue is the bill’s conditional structure: it requires New York City to enact a local law and mandates that certain sections be adopted in groups, which may limit flexibility for local lawmakers. The bill also changes credit formulas and scaling factors, which could affect how much tax relief certain corporations and banking entities can claim, making the measure more consequential for business taxpayers than a simple rate adjustment.