Proposed Changes in Payroll Tax Aimed to Help MTA

Governor Paterson says New York City employers have to come to the MTA's rescue once again. He wants to increase the payroll tax imposed last year, but not for everyone. WNYC's Matthew Schuerman has more.

REPORTER: The new payroll tax was supposed to provide a more stable source of funding for the MTA. But thanks to the recession, revenues came in well under the state's estimates. The MTA is once again looking at a budget deficit even after proposed service cuts go into effect this summer.

Governor Paterson wants to make up most of that shortfall by hiking the payroll tax from 0.34 percent to 0.54 percent of the amount employers spend on wages and salaries. The increase would apply only to workplaces within the five boroughs. Paterson would drop the tax in outlying counties to 0.17 percent because suburban businesses depend less on mass transit.