New York City is set to tax multimillion-dollar second homes as part of a new spending plan that could ensnare Donald Trump.
On Thursday, Kathy Hochul, the governor of New York State, announced that state officials had reached an agreement on a new budget, which included a so-called “pied-à-terre tax” championed by the likes of Zohran Mamdani, the city’s mayor.
It would target high-value second homes and investor-owned apartments worth $5m (£3.8m) and up, Ms Hochul’s office said, though it has not been disclosed how many homes will be subject to the tax or what the rate will be.
It is projected to generate at least $500m (£368m) annually, which officials hope can help close New York state’s more than $5bn (£3.8bn) budget deficit.
New York City is home to more people worth at least $100m (£74m) than any other city in the world, according to data from the London-based consulting firm Henley and Partners. Only San Francisco – the epicentre of the Silicon Valley tech boom – has more billionaires.
“I promised a budget that works for working people and expands opportunities for all New Yorkers and I was not going to back down from that fight,” Ms Hochul said in a statement.
Mr Mamdani has been a vocal supporter of the new tax. But he faced a backlash from the city’s business leaders after he posted a video last month outside a building where Ken Griffin, a billionaire hedge fund manager, owns a penthouse.
“This pied-à-terre tax is specifically designed for the richest of the rich,” Mr Mamdani said in the video, which mentioned Mr Griffin by name and the amount he paid for his penthouse.
Mr Griffin, however, said the video had put him “in harm’s way”, referring to the high-profile killing of Brian Thompson, the UnitedHealthcare chief executive, in Manhattan in December 2024.
“He seems to have forgotten that the CEO of another American company was assassinated just blocks from where I live in New York,” Mr Griffin said of the mayor.
Mr Trump could reportedly be subject to the new tax. The US president lists his legal residence as his Mar-a-Lago estate in Florida but retains a multimillion-dollar penthouse in Manhattan’s Trump Tower.
Mr Trump and Mr Mamdani struck up a seemingly friendly relationship after the 34-year-old became the youngest mayor of New York City in more than a century at the start of this year.
President Donald Trump shakes hands with then-New York City mayor-elect Zohran Mamdani in the Oval Office
But the president has made his views clear on the new tax.
“Sadly, Mayor Mamdani is DESTROYING New York! It has no chance!” he wrote on his Truth Social account in April.
“The TAX, TAX, TAX Policies are SO WRONG. People are fleeing. They must change their ways, AND FAST,” he added.
The state budget also includes measures designed to push back against immigration enforcement by federal agents, Ms Hochul’s office said.
Those include forbidding local police from being “deputised by ICE for federal civil immigration enforcement”.
A number of US cities have been subject to major immigration operations since Mr Trump returned to the White House.
Two protesters were shot and killed in Minneapolis as part of a weeks-long operation directed by the Trump administration.
While New York City hasn’t been the target of the same major immigration operations, federal agents have carried out sweeps in the city.
In October, Immigration and Customs Enforcement (ICE) agents conducted raids targeting street vendors on Canal Street in SoHo, which is often lined with stalls selling counterfeit handbags, watches and belts.