Cuomo confirms pied-à-terre tax is off the table, transfer tax could replace it

There were no clear specifics on what properties would be subject to a transfer tax

TRD New York /
Mar.March 29, 2019 06:56 PM
From left: New York State Senator Andrea Stewart-Cousins, Governor Andrew Cuomo, Speaker of the New York State Assembly Carl Heastie (Credit: Getty Images)

From left: New York State Senator Andrea Stewart-Cousins, Governor Andrew Cuomo, Speaker of the New York State Assembly Carl Heastie (Credit: Getty Images)

Gov. Andrew Cuomo on Friday confirmed that the controversial pied-à-terre tax, an annual levy on nonresidents’ homes valued at $5 million or more, is off the table.

During a press conference Friday evening, the governor said he and the legislature are working on an alternative to replace the tax in the proposed state budget. Instead of an annual tax, officials are working on a proposal for a one-time transfer tax on “high-end properties, residential and commercial” in New York. However, no further details on what the transfer tax would look like were provided.

The news follows various reports that the pied-à-terre tax had lost momentum, after resurfacing earlier this month. As of Wednesday, the governor maintained that the measure wasn’t dead.

“Some people believe we can do it with a real estate transfer tax and that would be better,” he told WNYC’s Brian Lehrer on Wednesday. “Obviously, if there’s a better way to do it, fine. But we’re committed to doing it and as of now on the pied-à-terre tax.”

A plan to legalize adult recreational marijuana also won’t make the budget, the governor said. It will instead be revisited after a budget deal is reached and before the end of the legislative session in June. Both the proposed pied-à-terre tax and the cannabis tax were eyed as possible revenue streams for the cash-strapped Metropolitan Transportation Authority.

“If we lose tax revenue generated by cannabis – then we will either need a 50/50 cash split between the city and state, or the pied-à-terre tax, which could raise as much as $9 billion,” the state’s Robert Mujica said earlier this month. “And we would still have a shortfall.”

Many in the real estate industry objected to the annual tax, claiming it would discourage high-net-worth individuals from investing in the city, which would, in turn, lead to less development. Brokers also warned that such a tax would hurt the city’s already soft luxury market, particularly among existing new development stock.

Cuomo noted that he won’t support another revenue stream congestion pricing — or any more funding for the MTA — in the budget without mandating certain reforms within the agency, including the debarment of the agency’s “bad” contractors. He said public campaign finance reform is also a priority for him in the budget.


Related Articles

arrow_forward_ios
Alexandria Ocasio-Cortez, Bernie Sanders and Elizabeth Warren

By the numbers: Breaking down national housing agendas from the far left

Nuveen CEO Vijay Advani, Blackstone President & COO Jonathan Gray and one of the Texas properties

Blackstone just sold off a 29M sf national industrial portfolio

The purge continues: WeWork’s head of real estate is leaving

Judith and Rudy Giuliani Rudolph and Judith Giuliani are divorcing after 16 years. (Credit: Getty Images, Trulia, Highrises)

Luxury properties at play in Rudy Giuliani’s ugly divorce

Governor Andrew Cuomo and Senator James Skoufis (Credit: Getty Images, NY Senate)

Owners of some residential properties can’t hide behind
LLCs anymore

Senator Brad Hoylman and Billionaires' Row (Credit: StreetEasy, NY Senate)

Pied-à-terre tax to make a return in Albany, lawmakers say

Jimmy Van Bramer (Credit: NYC.gov, iStock)

After failing to meet his own deadline, Queens council member returns thousands in real estate donations

General contractors are suffering under Trump’s new tariffs on Chinese goods

arrow_forward_ios