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Harrison Schools Save $60K From MTA Tax Repeal

HARRISON, N.Y. -- The Harrison Central School District will save $60,000 due to the Metropolitan Transit Authority (MTA) payroll tax being repealed by the state for small businesses and public and non-public schools.

In January, the New York State Senate voted to repeal the MTA payroll tax, which taxed businesses and school districts based on payroll. According to Superintendent for Business Robert Salierno, the district was slated to pay $185,000 for the year, but the repeal of the tax won’t require payment from the district in the months of April, May or June.

Salierno said that when the tax was issued by the state approximately two years ago, the district thought that it would hurt them since there was no reimbursement clause in the tax originally. When the state decided to reimburse school districts, Salierno said that the tax was more of a “nuisance” than anything else when it had to be paid.

“We would have to file for a refund, which was additional work,” Salierno said. “It would take time away from our treasurer who would have to submit paperwork for the reimbursement. The tax was almost like double taxation.”

The board of education officially voted to amend the 2011-12 school budget at their meeting on March 21 to adjust the current budget accordingly to fit the new financial numbers. According to the BOE agenda from the March 21 meeting, the elimination of the MTA payroll tax officially goes into effect on April 1.

“Anytime I make adjustments to the budget I have to seek the BOE’s approval,” Salierno said. “Since the state decided to discontinue the tax, we just adjusted our current budget to fit it in.”

According to the legislation, businesses in the seven suburban counties (which includes Westchester) in the taxing district that are still paying the MTA payroll tax had the tax rate reduced to .23 percent on Jan. 1. The tax will be further reduced to .12 percent for 2013 and will be fully repealed for every business as of Jan. 1, 2014.

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