When Frank Sinatra sang in New York, New York, “If I can make it there, I’ll make it anywhere,” I wonder if he was talking about the difficulty of doing business in New York today. New York recently launched a new government website, www.bighappenshere.com intended to attract more businesses to come to New York State. Launching to much fanfare via an expensive advertising campaign, “Big Happens Here” encourages people to visit the site and learn more about the virtues of opening a business here in New York. Undoubtedly there’s nowhere more difficult than New York.
As a born and bred New Yorker, who lives in New York City and owns a Public Relations Agency which employs more than 100 people, I agree that “Big Happens Here,” and wanted to save you a visit to the government website to help explain the “BIG” things which government boasts of that happens here.
The biggest “BIG” are the taxes – and government bureaucracy and obstacles to succeed with your business. As the ad tells you, “In New York State, a business can grow as big as anyone can possibly imagine” – and while that is true they will take nearly 50% of what you earn if you live in New York City. Between federal, state and local taxes expect to pay close to 50% after Medicare, unemployment, commercial taxes and all the rest. Grow your business in New York and you will pay increased commercial taxes as your need for office space grows.
In case you weren’t aware, New York ranks at the very bottom on the “Small Business Survival Index.” The Tax Foundation, a non-partisan Washington, D.C tax research group ranked New York State as the worst place in the nation for establishing a business based on taxes. I started my business, alone exactly 10 years ago – and I have built it and can tell you it’s hard to survive, never mind thrive, as a small business in the “once-Empire State.”
Make $250K+ and expect to pay nearly 50% taxes if you live in the city, and when you buy a home with the profits from the growth of your business, expect to pay high property taxes. (And if you own a business and make less than that, good luck having a family survive in New York.) New York imposes high taxes on personal income, individual capital gains, corporate income, and corporate capital gains. It’s a very clear signal of big things — and everything here is expensive.
If you decide to come here, make sure you get out before you die, or expect to lose the other half you made – the state’s death tax helps to send people packing for states with more friendly tax laws.
As the government site says: “No one ever came here to take a back seat, play second fiddle or make it small.” And that’s all true — but expect to pay them through the nose for it. Of course, if you rely on the government as an entrepreneur remember the scariest words Ronald Reagan said an entrepreneur can ever hear: “I’m from the government and I’m here to help.”
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