New York City, New York — New York City Mayor Zohran Mamdani announced Wednesday that his administration will pursue tax increases on wealthy residents and corporations as part of an effort to address a projected $12 billion budget deficit he says was inherited from the previous administration.
In outlining priorities for his upcoming budget, Mamdani said he plans to raise taxes by 2% on millionaires and increase the city’s combined corporate tax rate to just over 22%. He described the shortfall as a severe fiscal challenge, saying the city faces a crisis larger than the Great Recession and warning that no single policy change will be sufficient to resolve it.
Mamdani said his administration will not cut funding for essential services such as the NYPD and FDNY, instead emphasizing a mix of spending restraint, agency budget reviews, and new revenue. He added that the city must also revisit its financial relationship with New York State to close the gap.
Gov. Kathy Hochul quickly rejected the proposal, calling any approval for city tax hikes a “non-starter.” Hochul said her administration would not support raising taxes, noting Mamdani’s position was consistent with his campaign platform but lacked state backing.
Business leaders raised concerns about competitiveness, citing data showing New York City already has the highest combined corporate tax rate in the nation. Mamdani has blamed former Mayor Eric Adams for the deficit, while an Adams spokesperson disputed the claim, pointing to billions in city reserves left behind.
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