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Real Estate

Pied-à-terre tax sought by City Council members

The resolution supports state legislation that would apply an annual surcharge on homes worth more than $5 million that are not used as primary residences.

State Senator Brad Hoylman discusses his desire to

State Senator Brad Hoylman discusses his desire to create a pied-a-terre tax. Photo Credit: Linda Rosier

A new tax on pieds-a-terre may help pad the city's revenue, if some lawmakers have their way.

City Council members Mark Levine and Margaret Chin announced Monday that they would introduce a resolution later this week, with the goal of getting their colleagues to formally endorse a state-imposed surcharge on high-end second homes in the city. 

The resolution supports state legislation, initially introduced in 2014 and revived earlier this year, that would apply an annual surcharge on homes worth more than $5 million that are not used as primary residences. A sliding tax of between 0.5 and 4 percent of the property's value would be charged, under a measure sponsored by State Sen. Brad Hoylman and Assemb. Deborah Glick.

Many of the homes in question are vacant most of the year, according to Levine. 

"There are owners and part-time residents who are benefiting from a whole list of services, like police and fire, but they are not contributing a penny of income tax to our services," Levine said.

City Council Speaker Corey Johnson expressed support for the tax after hedge fund manager Ken Griffin purchased a penthouse at 220 Central Park South last month for a record-breaking $238 million.

Hoylman estimated that, under his bill, Griffin would pay an additional $8.9 million in taxes annually. He said the measure would be likely to bring in an additional $600 million in tax revenue.

The senator said he was not concerned that another surcharge  might drive wealthier New Yorkers out of the city and decrease the tax base. 

"Individuals who want to use New York City to stash their cash should pay more for it," Hoylman said.

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