ALBANY — Just days after ramming the highest cigarette tax in the nation through the state Legislature, Gov. Paterson suggested yesterday he would also consider proposals to hike the sales tax on clothing.
He revealed the tax-hike talk after huddling behind closed doors with legislative leaders for discussions on how to close an estimated $9.2 billion budget deficit before a looming Monday shutdown vote.
Paterson offered few details. But Democratic sources told The Post that Assembly Speaker Sheldon Silver (D-Manhattan) floated raising some $300 million by lifting the sales-tax exemption on clothing items under $110 and applying the tax to items currently exempt.
But another source, however, insisted it was Paterson and Budget Director Robert Megna who floated the tax hike.
The source said the proposal called for lifting the exemption in October after parents finish back-to-school shopping.
The exemption would be phased back in over the next 12 months.
The move would generate $300 million for the current budget and $660 million next year.
“They have some proposals on the table,” Paterson told reporters. “We’re reviewing them and, frankly, they don’t sound bad.”
He said talks included “conversations about different ways to do a sales tax, and that kind of thing,” before refusing to release more details.
The state has dozens of exemptions on sales tax, ranging from groceries to circus shows, to American flags, to satellite-television services. In fact, the state has the nation’s fourth-narrowest sales-tax base, according to a study.
Silver has desperately sought new revenue to restore cuts proposed by Paterson, including a planned $1.4 billion reduction in education aid.
Republicans, however, said taxpayers can’t afford to pay more after last year’s budget, which included a $3.9 billion soak-the-rich hike on New Yorkers making more than $250,000 a year.
“The Democrats in Albany default to tax increases,” said GOP gubernatorial candidate Rick Lazio during a swing through Albany.
“The last thing that this state needs right now, when it has yet to recover from the recession, are more taxes.”
Senate Minority Leader Dean Skelos (R-LI) said Senate Republicans would not vote for a 2010-2011 spending plan that included tax hikes, even if that risks a government shutdown.
“Taxpayers better watch their wallets,” Skelos said. “Just like last year, the taxpayer’s burden is only growing larger.”
Monday, the Legislature approved Paterson’s plan to raise the tax on cigarettes $1.60 per pack to $4.35 — the highest in the nation.
The state has gone nearly three months without a balanced budget.
Paterson has threatened to make lawmakers vote on his own budget proposal Monday, if legislative leaders fail to come up with a compromise plan in the next few days.
Lawmakers have approved two-thirds of the budget, but have closed only half of the deficit.