New York Leads Nation in Taxes and Spending, Report Finds

New York collected more taxes per capita than any other state in fiscal year 2024, surpassing California by 22%, according to a report by the Citizens Budget Commission (CBC). The state also ranks as the second-highest spender nationwide, with only Alaska exceeding New York's outlays when federal oil-money distributions are factored in. The CBC report identifies Medicaid and school aid as the primary drivers of the state's high spending. New York's overall Medicaid spending has exceeded $100 billion annually, with concerns raised about billions lost to fraud and increased costs attributed to the influence of health-labor unions and hospital lobbying. Spending on elementary and secondary education in New York was nearly $32,000 per student in fiscal year 2024, which is 81% above the national average. Despite this higher spending, the state's educational outcomes lag behind those in lower-spending states like Mississippi. According to the CBC, these substantial fiscal burdens negatively impact New York's ability to attract and retain residents and businesses. The report suggests that if New York's state and local governments mirrored the spending levels of Massachusetts, outlays would decrease by $64 billion. Comparing New York's spending to New Jersey's would result in a reduction of $99 billion, and aligning with Florida's lower spending would lead to a $170 billion decrease. Florida has experienced significant economic growth, partly attributed to an influx of residents and businesses from New York. The CBC warns that continued high spending and taxes could hinder New York's future economic prospects, particularly if current fiscal policies persist. Gov. Kathy Hochul and state Democrats have been criticized for what the report characterizes as prioritizing special interests over fiscal responsibility.