(The Center Square) — New York City Mayor Zohran Mamdani wants to raise taxes on the city’s wealthiest to help reduce a projected $12 billion deficit he says was inherited from the previous administration.
In a highlight of his upcoming budget, Mamndani told reporters on Wednesday that his administration will be pursuing his campaign pledge to raise taxes by 2% on millionaires and increase the combined corporate tax rate to just over 22%. He said the tax hikes are needed to whittle down the $12 billion deficit he “inherited” from the Adams administration.
“I will be blunt. New York City is facing a serious fiscal crisis,” Mamdani said in remarks Wednesday. “We are speaking about a fiscal crisis at this scale greater than the great recession. And so there will not be one single thing that can answer that crisis.”
In his remarks, Mamdani ruled out cuts to the NYPD, FDNY and other essential city services but warned that the budget gap must be filled to balance the spending plan. He said his budget writers will try to maximize savings by scrutinizing city agency budgets, but said that will only go so far.
“That also means raising taxes on the wealthiest New Yorkers and those profitable corporations, and it means recalibrating the relationship with the state,” Mamdani said.
But Gov. Kathy Hochul, a Democrat who was seeking reelection in the fall, swatted down the idea of giving New York City approval to raise taxes on the wealthiest residents, calling it a “non-starter.” She told reporters on Wednesday that it “isn’t a newsflash” that Mamdani wants to raise taxes to fund his agenda but ruled out support from her administration.
“We are not raising taxes in the state of New York, we are not raising taxes for the sake of raising taxes, so he will continue to say what he needs to say,” Hochul said.
New York City’s business community has raised concerns about an exodus of employers from raising taxes on job creators, warning it will ultimately hurt the city’s economy.
“We want to help Mayor Zohran Mamdani find a real solution,” Steven Fulop, president and CEO of the Partnership for New York City, posted on social media. “Let’s move past the relocation debate over taxes — people can argue that forever. The real question is simple: if you were starting or scaling a business today, would you choose NYC if these trends continue?
He cited a recent report by the nonpartisan Citizens Budget Commission showing New York City already has the highest combined corporate tax rate in the country at 17.44% and that matching New Jersey’s top rate would push NYC to 22.48% — nearly double New Jersey.
“That’s a competitiveness problem,” Fulop said. “Companies may not leave overnight, but they will stop expanding here. This week’s NYC jobs data is a warning sign — and exactly why we’re focused on helping get this right.”
Mamdani is blaming the city’s budget shortfall on former Mayor Eric Adams, accusing his administration of “negligent budgeting” and leaving behind a financial mess.
But a spokesperson for Adams said he left City Hall with $8 billion in reserves, suggesting that the new administration was being “disingenuous” about its claims of a budget gap.
“Despite these challenges, Mayor Adams led a real recovery through steady leadership and tough decisions,” the spokesperson said. “Blaming him for decades-old City-State funding inequities is inaccurate and disingenuous.”
