Mamdani threatens NYC property tax hike as last-resort option

[NEW YORK] New York City Mayor Zohran Mamdani has thrown down an ultimatum, threatening to raise property taxes by nearly 10 per cent as a way to lobby Governor Kathy Hochul for more funding. 

There’s just one problem. Hochul – who is running for re-election in November – hasn’t budged on her refusal to raise taxes on corporations and wealthy residents, repeatedly saying that there is no reason to hike the levies at this time. 

What’s more, City Council leadership is adamant they oppose a property-tax increase. The proposal would need approval from the council to be implemented.

Mamdani was elected on a wave of optimism and lofty promises to bring free childcare, no-cost buses, and a rent freeze to New Yorkers struggling in a city that has become increasingly unaffordable.

His US$127 billion spending plan released on Tuesday (Feb 17) is the first example of how the realities of city budgeting could hinder his ability to enact a progressive agenda that has always relied on cooperation from Albany. 

“The move is very bold, but it’s in keeping with Mamdani’s script, which is to be very bold,” said Lee Miringoff, a professor of political science and director of the Marist University Institute for Public Opinion. “Hochul is not going to give into his threats, but it might not be the last time she helps the city.”

Mamdani’s plan is a gamble, betting that his passionate political base, allies in the legislature, charisma and army of social-media supporters can convince Hochul to approve tax hikes in an election year when she’s repeatedly promised not to. Hochul did not include major tax increases in her budget proposal released last month. 

As mayor, Mamdani has minimal ability to raise revenue on his own – relying on state lawmakers and the governor to increase income or corporate taxes. His proposal to hike property tax rates was framed as a last-resort option if Hochul won’t provide more dollars – beyond the US$1.5 billion she earmarked on Monday. If implemented, the new rate would impact more than three million residences and over 100,000 commercial units. 

“We do not want to have to turn to such drastic measures to balance our budget,” Mamdani said. “But, faced with no other choice, we will be forced to.” 

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The proposal drew sharp rebuke from the real estate industry, local advocacy groups and some Democratic City Council members, many of whom are Mamdani’s political allies. Some noted that such a move would impact lower-income and middle-class residents more than the city’s wealthiest – an inequity that Mamdani himself has vowed to reform. 

“It’s irresponsible to talk about raising property taxes without reforming the property tax system,” deputy city council speaker Nantasha Williams said in an interview. “I think it will be very difficult to pass.” BLOOMBERG