Mayor De Blasio will renew his call for a “mansion tax” before this state Legislature in Albany today, reports Politico. In support of rent subsidies for 25,000 low-income senior citizens, the mayor has detailed a proposal that will raise the property transfer tax to 2.5 percent for any sale above $2 million. “We are asking for some basic tax fairness from the wealthiest New Yorkers so low-income seniors can afford their rent and continue to call the greatest city in the world their home,” the mayor said in a statement.
As Politico is quick to point out, the proposal is expected to struggle for Legislative support in the state capital. In 2015, the Mayor asked a similar tax be rolled into negotiations of the 421-a tax abatement that expired early last year, where sales over $1.75 million would be taxed 1 percent, and sales over $5 million would see a 1.5 percent tax. The increased rates would have provided another $200 million a year in revenue to be directed towards affordable housing initiatives, but the idea was rejected by state lawmakers.
As it stands, home sales over $1 million are subject to a 1 percent tax. The city’s Office of Management and Budget estimates 4,500 homes will sell for $2 million or more in the upcoming fiscal year, which would mean another $336 million in revenue for the city if the proposal were to be adopted.
Regardless, flop or not, the call alone will do a lot to enliven De Blasio’s supporters.
“DOA,” said one real estate official to Politico. “But it works for the mayor in terms of running for re-election and is a red meat issue for much of his base.”
Indeed, the mayor is up for re-election this year, and similar to his first campaign, he’s taken on affordable housing and income equality as his mantles. De Blasio also counts seniors as one of his most reliable voting blocs, many of whom have organized to support his previous housing proposals.
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- City Council May Bring Back Mansion Tax to Fund Social Programs