The fantasy of liberal utopias is once again proving itself absurd. New York City Mayor Zohran Mamdani rolled out his first budget proposal in the form of a threat. Facing a deficit he maintains he inherited, Mamdani warned that unless state lawmakers approve his proposal for a new wealth tax, the city would move forward with a 9.5 percent increase in property taxes.
Such a hike would affect roughly 3 million residential properties and about 100,000 commercial buildings. The added costs will likely ripple through the housing market, impacting homeowners as well as renters whose landlords pass along their higher tax bills.
Most importantly, the move signifies complete hypocrisy to his entire previously stated platform to focus on affordability, particularly when it comes to housing. According to the mayor’s own budget documents, the median income of those projected to be affected by the increase would be $122,000 — a figure that stretches differently in New York City than in many other parts of the country, and one that still means half of those impacted would earn less than that amount, writes National Review.
The proposal would also draw from the city’s rainy-day reserves and tap into a health benefits fund set aside for retired municipal workers. Mamdani described the alternative as a “harmful path” that could be avoided if Governor Kathy Hochul and the state legislature approve his plan to raise taxes on higher earners and corporations. A wealth tax would require state authorization, and Hochul — who is seeking reelection — has signaled opposition.
City Council leaders quickly expressed resistance. “At a time when New Yorkers are already grappling with an affordability crisis, dipping into rainy day reserves and proposing significant property tax increases should not be on the table whatsoever,” New York City Council Speaker Julie Menin and finance committee chairwoman Linda Lee declared in a joint statement.
Supporters of the wealth tax argue it would make the tax system fairer, but critics point to data suggesting high earners already shoulder a large share of the burden. An analysis by the Empire Center for Public Policy found that “Filers in the top 1 percent — which roughly corresponds to incomes of $1 million or more — accounted for 46 percent of income tax paid and one-third of total state tax revenue in 2023,” the latest year available.
Meanwhile, the state comptroller’s office reported of Wall Street’s impact on the city: “The securities industry is a major tax contributor to the state and city through business taxes on profits and personal income taxes on employees’ salaries. The industry generated an estimated $6.7 billion in revenue for New York City in fiscal year (FY) 2025, up 35.1% from the prior year, and represented 8.4% of the city’s total tax collections that year.”
Rather than reducing spending to address the deficit, Mamdani is proposing to increase the city’s budget by $5 billion, bringing it to $127 billion, National Review points out, adding that by comparison, Florida Governor Ron DeSantis has proposed a $117 billion budget for the entire state of Florida — which has a population of 23.5 million, compared with New York City’s 8.5 million residents.