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Manhattan supermarkets should be exempt from commercial rent tax, Gale Brewer says

In 2016, 132 supermarkets collectively paid $5 million in commercial tax dues.

Manhattan Borough President Gale Brewer, center, promotes a

Manhattan Borough President Gale Brewer, center, promotes a bill that would exempt supermarkets from the commercial rent tax. Photo Credit: Ivan Pereira

Manhattan’s supermarkets have been struggling to survive due to rising rents, competition from other stores and other costs, according to its borough president, Gale Brewer.

But Brewer believes the city can easily remove one of these hurdles, and give mom-and-pop grocers a new lease on life.

She and other supporters gathered on the steps of City Hall Monday and called on the City Council to pass a bill that would exempt supermarkets from the commercial rent tax, which applies to businesses that pay more than $250,000 in rent annually on spaces located between Murray and 96th streets in Manhattan.

Brewer argued this specific application of the tax generates little money — 132 supermarkets paid $5 million in commercial rent tax dues last year — and that the surcharge is an outdated remnant of legislation passed in the 1960s.

“It’s a tax that we may have needed in the 1960s,” Brewer said. “But it has outlived its purpose.”

Brewer said a council bill she introduced earlier in the year with City Councilman Corey Johnson would bring relief to struggling supermarkets by exempting them from the tax.

Paul Fernandez, president of the New York Chapter of the National Supermarkets Association, said the bill would go a long way for the supermarket owners.

Sloan Williams Supermarkets vice president Steven Sloan agreed, noting that the surcharge, on top of already rising rent rates, makes it difficult for the company to continue serving Manhattan communities.

“It’s becoming an increasing struggle for us to stay afloat,” Sloan said.

Some advocates of mom-and-pop shops said at the news conference that the council could do more to help small businesses by advancing a long-stalled bill that would require 10-year commercial leases and give businesses more sway when they are struggling to make rent.

Brewer said she supports that measure, and believes the tax exemption bill would complement it.

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