New York to tax luxury second homes in NYC but stops short of hiking income taxes on the wealthy
NEW YORK (AP) — Buyers luxury second homes A person who lives in New York City but lives most of the year elsewhere would have to pay a new tax on properties covered by a temporary agreement; This was an attempt to appease Mayor Zohran Mamdani and the liberal voters who brought him into office with slogans of “tax the rich.”
But the deal is part of the expanded budget plan announced by the Governor on Thursday. Kathy HochulIt will fall behind a major priority for mayor: a broad tax increase on the state’s wealthiest residents.
The proposed tax on multimillion-dollar second homes, known as pied-à-terres, comes as Democrats seek to assuage voters’ concerns about affordability without alienating businesses ahead of this year’s midterm elections.
Critics, including prominent business leaders, Republicans and some moderate Democrats, have warned that imposing new taxes on the wealthy who own apartments and townhomes in New York but do not call it home would lead the very wealthy to leave the city.
Details of the offer have not yet been finalized, but Hochul said it would apply to homes valued over $5 million. This would only apply to second homes in New York City, not other state playgrounds for the wealthy, such as Long Island’s mansion-filled Hamptons.
Hochul estimated the tax would bring in at least $500 million a year to the city.
Following the governor’s announcement, the state’s legislative leaders cautioned that there was still much left to negotiate. “There is no budget agreement,” said Carl Heastie, the Democratic speaker of the state House, adding that much of the fiscal backbone of the budget has not yet been decided.
Meanwhile, the New York City chapter of the Democratic Socialists of America, of which Mamdani is a member, sent text messages to supporters saying the budget proposal did not go far enough to close New York City’s multibillion-dollar budget deficit or fund needed social programs.
“Hochul is trying to shove down our throats a deal that would impose no new taxes on the rich, other than a land tax that fills only 10% of NYC’s budget deficit,” Gustavo Gordillo, the organization’s co-chairman, said in a statement. he said.
Hochul, a Democrat running for reelection, opposes broader tax increases on the wealthy, saying they risk encouraging wealthy residents and businesses to flee to lower-tax states.
“With all of these accomplishments, we were able to deliver this extraordinary budget without increasing statewide taxes at all,” Hochul told reporters Thursday.
While Mamdani calls the tax a victory, he sometimes pushes personally for further tax increases on the very wealthy.
Last month, seeking to drum up excitement about his new tax plan, the mayor posted a video of himself standing in front of a luxury building occupied by billionaire hedge fund CEO Ken Griffin. bought a penthouse approximately $239 million.
“When I ran for mayor, I said I would tax the rich,” Mamdani said in the clip, which has been viewed more than 52 million times on X, before mentioning Griffin’s name. “Well, today we tax the rich.”
Griffin later said he was shocked by the video, calling it “frightening” and potentially threatening his safety. UnitedHealthcare’s CEO added: brian thompsonHe was allegedly shot to death in the same neighborhood by someone upset with corporate greed. Griffin said his company has decided to expand its operations in Miami.
“What the mayor of New York has made clear to my partners, and especially to my New York partners, is that we need to double down on our bet in Miami,” he said at an economic conference in California this week. “Because we want to be in a state that embraces business.”
