Liu Proposes Income Tax Hike for City's Top 1 Percent

New York City Comptroller John Liu says the city's income tax system is unfair and top earners should pay more. He released a plan on Thursday that would cut taxes for 99 percent of the city's residents, while boosting tax rates for joint filers who earn more than $500,000 a year.

New York City's local effective tax rate is relatively flat. A family that earns $50,000 a year pays a tax rate of 3.3 percent while a family that earns $1 million pays a rate of 3.7 percent.

Under Liu's plan, the family earning $1 million would see its rate rise to 4.3 percent.

Liu says his proposal makes the city's rates "truly progressive" and would help close budget deficits.

A spokesman for Mayor Michael Bloomberg did not return an email seeking comment.