New York City May Get a Pied-à-Terre Tax for Pricey Second Homes
After news broke that billionaire investor Ken Griffin dropped $238 million on a Manhattan penthouse, the entire country was abuzz since it shattered the record for the most expensive house sold in America. Since the finance tycoon is only planning to use it as a second home as he spends more time in New York City for business, it also stirred up heated pushes for a pied-à-terre tax.
It’s ridiculous that this kind of astronomical wealth can exist in our city and never reach the people that actually live here.— Senator Brad Hoylman (@bradhoylman) January 30, 2019
I first proposed a pied-à-terre tax in 2014 because it’s smart policy. Let’s keep it on the table. https://t.co/8VQL5oxwko
This is not a new idea, but one that has been dormant since 2014 when Senator Brad Hoylman proposed it. According to a report by the Fiscal Policy Institute, a tax of 4% on pied-à-terres costing $5 million plus can rake in a minimum of $665 million in revenue per year for NYC. Often, wealthy owners who fall under this category don’t have to pay local taxes that help cover the city’s necessities, and also get by paying very low property taxes. With subways to renovate and some people facing evictions due to a shortage of affordable housing, the kind of money a tax like this could bring could go a long way in helping the city’s residents.
According to Curbed, some powerful real estate figures criticized the bill when it was first proposed. For it to come back to life and then become law, it will have to pass at the state level, so legislators will most likely try hard to gain more support this time around.