12/31/2008
On December 16, 2008, Governor Paterson released the Executive Budget plan for 2009-2010. In an effort to reduce a record $13.7 billion budget deficit, the Executive Budget recommends increasing and extending taxes and fees along with spending cuts in virtually all government programs. If the recommended budget is passed, massage therapists would potentially be affected by three proposed measures:
1. The extension of New York City's personal and credit services sales tax statewide. This would make personal services (such as beauty, barbering, manicure, pedicure, massage, health salon, or gymnasium services) and credit rating and reporting services subject to sales tax statewide. Currently, only New York City imposes a sales tax that applies to these services.
ABMP's view: Most visits for massage therapy are for treatment of symptoms. Massage therapy is a form of health care recognized by the National Institutes of Health and clients should not be lumped in with personal services such as beauty and barbering. At the very least, clients presenting a prescription for massage therapy should be exempt from the tax. Health insurance rarely covers massage and bodywork. Taxation of individuals who are already paying out-of-pocket to relieve their pain literally adds insult to injury.
Fifty-eight percent of massage therapists are self-employed. The task of collecting and paying a service tax could double the time spent on the administrative duties of owning a practice. ABMP has already been in contact with the governor's office and intends to contact assembly members and leadership with our views.
2. Expansion of fingerprinting to licensed insurance personnel. This would require fingerprinting and background checks at current fee levels of $75 for any individual who is applying for a license under Article 21 of the Insurance Law. If you receive insurance reimbursement for massage services, you would be required to comply with a background check.
3. Increased state licensing fees. This would increases licensing examination fees for 16 disciplines licensed by the Department of State, including massage therapists. These fees have been increased at various times between 1967 and 2005. The current exam fee is $250, the license fee is $100 and is valid for three years. New York's fee structure is currently below the national average.
The governor is responsible for developing and preparing a comprehensive, balanced budget proposal, which the legislature modifies and enacts into law. By mid-January the legislature will begin analyzing the governor's proposals, primarily through its fiscal committees (Senate Finance and Assembly Ways and Means), but both houses will have to come to an agreement on priorities.
Action
ABMP recommends contacting your assembly member to voice your concerns. Attempting to expand service taxes to massage therapy and other personal services has become an increasingly common way for states to try to increase tax revenue. We have had success in defeating some attempts, but only if massage therapists become involved in contacting their representatives. Many legislators assume they are imposing a "luxury tax" on wealthy people, not knowing that most people seek massage for pain relief. It would also be prudent to have your clients contact their legislators since they are the ones who will be taxed for their healthcare service.
If you do not know who your representative is, go to:
http://assembly.state.ny.us/mem/
The 2009 Yellow Book, a Statistical and Narrative Summary of the Executive Budget Prepared by the Assembly Ways and Means Committee, was released on December 22nd. To view the Yellow Book, go to:
http://assembly.state.ny.us/Reports/WAM/2009Yellow/
To view Governor Paterson's Executive Budget, go to:
http://publications.budget.state.ny.us/eBudget0910/fy0910littlebook/RevenueActions.html
To view legislative updates for New York, visit the interactive legislative map at www.abmp.com.
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