The implementation of New York City Democratic Mayor Zohran Mamdani’s new pied-a-terre tax was ruled “arbitrary” and “capricious,” marking a major setback for the socialist official and his efforts to tax wealthy citizens.
Mamdani proposed the tax for homes worth at least $5 million, as well as co-ops and condos worth at least $1 million, if they are unoccupied non-primary residences.
Staten Island Supreme Court Justice Wayne Ozzi ruled that the city inappropriately mailed notices to over 1,000 New Yorkers who were not actually subject to the tax, according to a report from the New York Post.
The homeowners were then “substantially harmed and penalized needlessly” when they had to show city officials they were not liable to pay the tax.
Ozzi concluded that all of the 17,000 notices sent to residents need to be cancelled, and that they must be resent individually.
Matt Rauschenbach, a spokesman for Mamdani, denounced the ruling in a statement.
“Today’s decision is wrong, and we will invoke a stay of the injunction,” he said, according to a report from the Associated Press.
Should the Mamdani administration be held accountable for mishandling the tax notices?
Yes, they should face consequences
100% (27 votes)
No, it was an honest mistake
0% (0 votes)
Only if it happens again
0% (0 votes)
I don’t know enough to say
0% (0 votes)
“With a stay, we will continue implementing the surcharge fairly, efficiently and in full compliance with the law, as we have since day one.”
Randy Mastro, who filed a lawsuit against the policy on behalf of residents, meanwhile celebrated the ruling.
“We’re gratified that the court has recognized we were right all along,” he reacted.
“The fact is that this administration failed to follow state law when it burdened New York City homeowners with proving they live in their own homes or be on the hook for paying a new surcharge,” Mastro continued.
“Now the administration must go back and do what it should have done from the start: use all the information at its disposal to make an individualized ‘initial determination’ about who truly owes this surcharge before demanding that they pay it.”
The ruling comes as casino mogul Steve Wynn and former Trump administration Secretary of Commerce Wilbur Ross join the effort against the tax.
Both magnates have primary residences in Florida and argued in a lawsuit that they already pay significant property taxes, not to mention contributions to New York City charities, per the Associated Press.
New York Democratic Gov. Kathy Hochul, who approved the pied-a-terre tax, blasted Wynn and Ross for criticizing the policy.
“When Steve Wynn and Wilbur Ross try to cast themselves as sympathetic figures in a fight over paying their fair share on multimillion-dollar second homes, they’re making the case for the pied-à-terre tax as well as anyone could,” she said.
Mamdani has said the tax will raise another $500 million for New York City.
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