ALBANY, NY – [Photo: Susan Watts/The Governor’s Office]
New York Governor Kathy Hochul proposed on April 15 a pied-à-terre tax to support Mayor Zohran Mamdani’s efforts to close New York City’s budget gap. The proposal targets luxury second homes in New York City valued at $5 million or more, allowing the city to levy a yearly tax surcharge aimed at ultrawealthy, non-New York City residents. As New York City faces a significant budget gap, the Governor’s proposal will generate much needed revenue for the city without impacting every day New Yorkers.
The proposal is expected to generate at least $500 million a year in recurring revenue for the City. It builds on the Governor’s recent announcement that the state will provide an additional $1.5 billion for New York City in the FY2027 budget. As part of ongoing discussions, the City of New York has also committed to achieving significant savings in order to balance its budget.
“New York City is the greatest city in the world, and the people who call it home should not be left carrying the burden alone,” Governor Hochul said. “As Governor, I understand the importance of stabilizing the city’s finances without compromising on essential services New Yorkers count on. If you can afford a $5 million second home that sits empty most of the year, you can afford to contribute like every other New Yorker”.
A pied-à-terre tax is an annual surcharge on residential properties in New York City that are not occupied as a primary residence. The tax would ensure that those that own luxury homes, but do not live in the City or pay City income tax are still fairly contributing towards the funding of the essential services like policing and parks that make New York City a global destination. The tax would only apply to those homes that are not the primary residence of the owner or are not rented to a primary resident or occupied by the owner’s family.
New York City Mayor Zohran Mamdani thanked Governor Hochul for her support, saying that “we are one step closer to balancing our budget by taxing the ultra-wealthy and global elites with a pied-à-terre tax — the first of its kind in our state. Alongside the governor, our administration is fighting every day to make sure we address this fiscal deficit fairly, where the wealthy contribute what they owe and our budget reflects our commitment to the working New Yorkers being priced out of our city”.
