Posted by Leonard Steinberg of URBAN COMPASS on November 19th 2014

New York City imposes a 1% tax on apartments selling for $1 million or more. It is called a MANSION TAX. It is a disguised additional tax as we all know all to well that there is no such thing as a mansion in New York that costs $1 million, $2 million, or $5 million for that matter. From a tax perspective, the word MANSION is as mis-used as the word ‘luxury’, but it is a sure-fire way to get the votes. Now comes word that City Hall is floating around the idea of RAISING this absurd mansion tax to generate more income for its affordable housing plans. The Mansion tax generated about $259 million for New York State in 2013.

This tax raise is being supported by some of New York’s wealthiest real estate owners who would much prefer buyers of real estate to pick up this tab than the owners of rental buildings. Shocking. I think its really bad business to raise taxes on a discriminatory basis. This law is already discriminatory in that it identifies real estate costing $1 million as a mansion when clearly that is not the case.

Mayor De Blasio should first focus on the gross inequality of real estate taxes whereby similar valued properties are being taxed ridiculously differntly from one another, his own home in Park Slope being the perfect example. The Mayor pays less than $3,000 per year in real estate taxes where some similar valued properties are paying double and triple. If all those homeowners who are paying half the taxes of similar valued property owners were to pay the same as this disadvantaged select group, I feel certain much more tax revenue would be raised than by picking on a small group of home buyers.