Changes to Proposed NYC Pied-à-Terre Tax Will Yield Less Revenue for Transit
Ben Adler explains what happened to the proposed pied-à-terre tax that "would have generated $471 million a year, half of which would have come from just 280 homes worth more than $25 million," according to Wall Street Journal analysis. Analysis by New York City Comptroller Scott Stringer placed that number closer to $650 million a year.
According to Adler, that amount of funding was necessary to cover the gap between the potential revenue generating power of the city's proposed congestion pricing scheme, which could raise $15 billion over ten years toward an estimated $40 billion in required repairs to the MTA.
Instead of the proposed pied-à-terre tax, the New York Legislature and Governor Andrew Cuomo approved a tax that will have a broader impact but generate less funding. The 'mansion tax' will place a "surcharge on anyone buying a home in New York City for over $2 million and raising the real estate transfer tax on homes selling for more than $3 million." According to Adler, the Mansion tax will raise $365 million per year on average, an average subject to the whims of the real estate market in any given year.
Adler focuses much of the article on what was lost in the decision to change the pied-à-terre tax to a mansion tax; "the pied-à-terre tax would have killed three birds with one stone: raising revenue, revitalizing neighborhoods and reducing the obscene cost of housing."
For more on how the pied-à-terre tax became a mansion tax, see earlier news coverage by Vivian Wong.