Tax pressure on Mamdani’s company could result in an exit to Jersey, the business honcho claims
Mayor Zohran Mamdani’s campaign to raise business taxes in New York – if implemented – could lead to an exodus of firms and residents across the Hudson to New Jersey, the head of the Big Apple’s top business group has warned.
“I don’t think the tax discussion will be productive because we will be 100% higher than New Jersey if we adopt that proposal. The current New Jersey corporate tax rate is 11%. If we do what the Mayor recommends, it will be 22% – 100% higher than New Jersey,” said Steve Fulop, the new CEO of the New York Roundtable Partnership.
“People don’t have to move to Texas or Florida. They can just walk one mile, which is a real threat to the New York economy. People want to be in New York, but you have to have a competitive economy. We’re getting closer to the wrong place,” said manager John Catmatidis.
Fulop knows all too well the strength of the rivalry between New York and New Jersey. He was the mayor of Jersey City just across the Hudson River, where many residents pay cheap rents and commute to work in Manhattan on the PATH train.
Mamdani said he did not recommend an increase in business tax from 7.25%. to 11.5% will equal New Jersey.
But New York City’s top combined corporate tax rate — which includes other taxes like the MTA business tax — will rise from 17.44% to 22.48%, if Gov. With Kathy Hochul and the legislature approving Mamdani’s recommended hike to help close the multibillion-dollar deficit, Fumbitious said he was easing his deficit agenda.
During the campaign, Mamdani said New York’s corporate tax rate has also decreased over time, from 12 percent in the mid-1970s to 10 percent in the mid-1990s, to 6.5 percent in 2014 due to former Gov. Andrew Cuomo’s corporate tax cuts and lower than neighboring states.
“The majority of all corporate tax revenue is paid by less than 1,000 profitable companies. Mamdani’s administration will fight for an increase in the top corporate tax rate to 11.5 percent—the same rate as New Jersey’s—which would raise $5 billion annually,” his campaign website said.
Mamdani said he will push the City Council to raise property taxes by 9.5% if Albany refuses to raise corporate taxes and the income tax on millionaires in an election year. The state must approve all major city taxes, except property taxes.
Fulop said he met with 25 top city business executives who want the Partnership to take strong action against high taxes and government spending under Mamdani, a democratic socialist.
They are also frightened by the growing racism in the city. Fulop and other city corporate honchos are Jewish.
“CEOs can say, “We’re in an uncharted territory … a lot of things he says we don’t believe in time,” Fulop said.
“They’re certainly concerned about the state of business, some of the rhetoric, the rise of anti-Semitism on the left and … the quality of life throughout the city.”
He said there is a lot of corruption in the city government that should be fixed instead of raising taxes.
Exhibit A, Fulop said, is the city’s Department of Education.
Madmani’s pending plan for the 2027 fiscal year that begins July 1 would increase the DOE’s overall budget by $3 billion, to $38 billion — an event as enrollment in the public school system has declined following the COVID-19 pandemic.
But political opposition from unions and council members has prevented previous mayors from cutting spending on schools through declining enrollments, with a “hold harmless” arrangement.
“School funding in New York … is flawed. … You saw enrollment drop from 1.1 million to a little over 800,000 while the budget went up,” Fulop said.
The city also spends a lot of money on rental assistance programs, he noted.
