Groundwork Collaborative Releases New Analysis on Fiscal Case for NYC Millionaires Tax
Groundwork Collaborative Releases New Analysis on Fiscal Case for NYC Millionaires Tax
Read “Closing the Gap: Why New York City Needs a Millionaires Tax” here
With Albany’s April 1 budget deadline approaching, Groundwork Collaborative today released “Closing the Gap: Why New York City Needs a Millionaires Tax.” The report lays out the origins and details of the budget gap NYC is facing, why the gap cannot be closed without significant additional revenue, and the critical choices before Albany and City Council.
“The record is clear: higher taxes make millionaires squawk, but not fly the coop,” said Lindsay Owens, Executive Director of Groundwork Collaborative. “The millionaire flight myth has been debunked time and again — in New York, in New Jersey, in Massachusetts. When we ask the wealthy to pay their fair share, they stay put and communities prosper. The only question left is whether Albany and the City Council have the courage to act on the evidence and start doing right by working New Yorkers.”
Some key points from the report:
- New York City’s budget gap is the product of Mayor Adams’ four years of deliberate underbudgeting — adding spending commitments to an already overstretched budget and ignoring spending obligations he knew were coming, leaving his successor with more than $12 billion in unaccounted-for liabilities.
- Mayor Mamdani’s budget identifies $1.7 billion in savings measures and operational reforms to help close the gap. But he cannot cut his way to a balanced budget without running afoul of state mandates or gutting services that millions of New Yorkers depend on. The budget gap can only be fully closed through an increase in revenues.
- Mayor Mamdani’s budget contains two proposals to raise the revenue to close the budget gap. Plan A is the Fair Share Act — a two-point surtax on incomes over $1 million, affecting just 0.7% of city taxpayers. Because New York City’s revenue authority is largely controlled by Albany, enacting the Fair Share Act requires state authorization. Without it, the city’s only lever is a property tax increase that would fall disproportionately on working families in Staten Island, Southeast Queens, Eastern Brooklyn, and the Northeast Bronx, with renters feeling it too as landlords pass on costs.
- The millionaire flight argument invoked by critics of the Fair Share Act is not supported by evidence from New York or anywhere else. High earners are embedded — by family, by profession, by the very networks that made them wealthy — and history shows they stay despite similar income tax increases.
The full report is available here.
