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New York Middle Class Tax Cut Legislation Passes

Updated 7:40 a.m. Thursday

ALBANY (CBSNewYork) -- State lawmakers have made a tax cut deal reality.

Albany lawmakers passed a bill that cuts taxes for the middle class but makes millionaires pay a whole lot more late Wednesday night.

Members of the State Assembly finally passed the measure 130-8 in a vote early Thursday. The bill puts more money in the pockets of 4.4 million middles class New Yorkers. It passed the Senate earlier Wednesday evening by a vote of 55-0, with seven Democrats excused.

"I think it's fairness, it's equity. People who make $40,000 to $50,000 a year should not be paying the same tax rate as people who make $5 million a year," Assembly Speaker Sheldon Silver said.

Under the bill, everyone will get some sort of tax break because the old millionaires' tax surcharge will soon expire, but in the new plan millionaires will face a much higher rate than the middle class.

For example, those who earn $200,000 will pay $400 less in state income taxes, paying $13,300 in taxes instead of $13,700.

If you earn $2.5 million, you'll pay nearly $60,000 more in taxes -- $225,000 in stead $171,250.

"The state gets a little more special revenue and people who need it the most get the biggest tax break," Silver said.

The deal negotiated by Gov. Andrew Cuomo will bring in $1.9 billion in new revenue. Both the democratically controlled assembly and the republican controlled senate signed on, but the no-new taxes Republicans found it a more difficult pill to swallow.

"The upper classes will pay the majority of the tax. It's unfortunate, but we have to cover the hole in our budget," State Sen. Martin Golden said.

"We live in a state that taxes too much, that regulates too much. We've got to break that cycle," added Sen. Andrew Lanza added.

But on the other side of the aisle …

"People are hurting -- got to pitch in," Assemblyman Keith Wright said.

"I think we need to tax people who earn more and put more money in the pockets of middle class," Sen. Jeff Klein added.

The tax rates will go into effect Jan. 1.

Calls seeking an interview with Gov. Cuomo have not been returned. It is unclear when he will sign the bill into law.

Please offer your thoughts in the comments section below.

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