New York Mayor Zohran Mamdani’s plan to extract more tax dollars from the Big Apple’s luxury second-home owners just cleared a major hurdle. A state appeals court on Wednesday said his administration can keep rolling out its “pied-à-terre” surcharge, reversing a Staten Island judge who had ordered the city to redo the launch, the New York Times reports. The tax targets non–New York City residents who own high-end condos, co-ops, or one- to three-family homes they use as second residences, and is projected to bring in about $500 million a year.
The tax doesn’t apply if the property is rented out or occupied by a close relative full-time. The lawsuit that led to Wednesday’s ruling focused on confusion over notices sent to owners, not the tax itself. The appeals court rejected the earlier ruling, which said people notified that they could be subject to the tax had suffered “irreparable harm,” the Wall Street Journal reports. “All taxpayers incur time, effort, and costs in determining and complying with their various tax obligations,” the appeals court said.
Mamdani said he was “heartened” by the ruling, calling the lawsuit “an attempt by the ultrawealthy to avoid paying their fair share.” He added: “From Day 1, those with the most have attempted to use every legal avenue available to shield their wealth and avoid contributing more to our city.” Two separate cases, including one brought by former Commerce Secretary Wilbur Ross and casino tycoon Steve Wynn, challenge the constitutionality of the tax and claim it unfairly singles out non–New York State residents.