The Mamdani administration’s proposed pied-a-terre tax could raise more than $500 million in revenues annually, but substantial variables in the design, implementation, and enforcement of the program could result in the estimate falling by as much as one-third, New York City Comptroller Mark Levine reported. The tax would be levied on an estimated 11,200 residential properties valued at $5 million or more that are not used as primary residences.
Levine said the estimates of annual revenue from the tax are limited not only by the tax rates, but also by key unresolved questions about how the city’s Department of Finance will address key factors. These include primary-residence ownership and rental exemptions; co-op and condo valuation; treatment of two- and three-family homes; and potential behavioral changes.
In addition, legal, policy and implementation questions could materially affect revenue outcomes and administrative feasibility, Levine reported. “As we continue to work toward budget agreements at the city and state levels, it’s imperative that government leaders, advocates and New Yorkers know how major new revenue proposals might reliably impact our budget,” he said.
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