This past weekend, Sen. Bernie Sanders flew into New York City with a familiar message: tax the rich. His visit was no coincidence. It came just days before the state’s original budget deadline, as Gov. Kathy Hochul and the State Legislature spar over proposals that could raise taxes on New Yorkers.

Hochul has been clear in her opposition to raising taxes. In a state where the cost of living continues to rise, she has rightly argued that new tax burdens are unnecessary and would undermine New York’s economic progress. The legislature, however, is moving in the opposite direction. Its proposals — aligned with New York City Mayor Zohran Mamdani’s high-tax agenda — would push tax rates to some of the highest levels in the nation.

Supporters claim these increases would only affect large corporations and the wealthiest New Yorkers. But that framing ignores a fundamental economic reality: When you raise taxes on businesses and top earners, the costs rarely stay contained to just those groups. They ripple outward — raising prices, suppressing wages, and making New York less affordable for everyone.

Hochul and the legislature entered budget negotiations with a shared goal: lowering costs for everyday New Yorkers. Yet the legislature’s approach would do exactly the opposite. Increasing taxes on businesses would force companies to pass those costs on to workers and consumers. At a time when families and employers are struggling to keep up with inflation, this is the wrong direction.

The scope of the proposed tax increases is significant, which is why we joined a coalition of 32 New York business leaders in urging the governor to hold the line against tax increases. The legislature has advanced a plan to raise the state’s general corporate tax rate from 7.25% to 9% for companies with more than $5 million in income.

Small businesses and independent workers would not be spared. The proposal would raise the Unincorporated Business Tax for makers and freelancers and reduce the pass-through entity tax credit, effectively increasing taxes on many small-business owners and entrepreneurs. Taken together, these measures represent a broad-based increase in the cost of doing business in New York. And when business costs go up, those increases do not disappear. They get passed along to consumers in the form of higher prices, lower wages, and fewer job opportunities.

New Yorkers have already seen how this dynamic plays out. When businesses faced tariffs on imported goods last year, customers saw prices rise. As the war in the Middle East drives up energy costs, we are paying more to gas up our cars and heat our homes. Taxes operate in much the same way. If enacted, the legislature’s proposals would have real consequences. Grocery bills would climb as food producers and distributors pass along higher costs. Housing would become even less affordable as developers and landlords take on higher tax burdens. Professional services — from accounting to child care — would become more expensive as small businesses adjust to survive.

With New Yorkers already leaving the state in search of a lower cost of living, further raising prices could send even more folks packing and undermine the state’s long-term economic growth.

The choice before state leaders is clear. They can pursue policies that make New York more affordable and competitive, or they can adopt measures that increase costs and make it harder for businesses and families to stay afloat. Hochul has charted the right course by opposing broad-based tax increases. For the sake of New York’s economy and the families and workers who depend on it, she must stand her ground.

This guest essay reflects the views of Steven Fulop, president and CEO of the Partnership for New York City, and Heather Mulligan, president and CEO of the Business Council for New York.