Mamdani threatens 9.5% property tax increase if state doesn't raise taxes on wealthy

Mayor Zohran Mamdani on Tuesday proposed a 9.5 percent property tax increase for New York City, framing the measure as a "last resort" contingent on the state failing to raise income taxes on the wealthy.

The proposed increase would affect more than 3 million single-family homes, co-ops and condos, as well as over 100,000 commercial buildings, Mamdani said while presenting his preliminary spending plan. The budget proposal totals $127 billion, an increase from the current $122 billion spending plan, and would take effect July 1 following revisions and negotiations with the City Council.

Mamdani cited a projected two-year budget gap of $5.4 billion as the reason for the fiscal measures. This figure represents a reduction from the city's earlier estimate of roughly $12 billion in overall deficit. The announcement came one day after Governor Kathy Hochul provided the city with $1.5 billion in budget gap relief.

City Comptroller Mark Levine, a Democrat, told NY1 after a closed-door briefing with Mamdani and his budget aides that raising property taxes would be undesirable. "Raising property taxes would be no one's preferred option, partly because the system is so flawed, riddled with inequality," Levine said.

Mamdani, the city's newly elected democratic socialist mayor, indicated that a tax increase is necessary to address the fiscal shortfall. One of the limited ways a mayor can raise revenue at the city level is by changing the property tax rate, an action not undertaken since former Mayor Michael Bloomberg was in office.

The mayor's ultimatum essentially presents state legislators in Albany with a choice between approving higher income taxes on wealthy residents or allowing the city to proceed with the property tax increase. The budget plan represents Mamdani's first spending proposal since taking office.