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New York passes pied-a-terre tax

cnbc.com

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Re: New York passes pied-a-terre tax

#241

Post by zozbot234 »

cucumber3732842 wrote: post #186
pydry wrote: post #123

Earlier quoted context omitted.

Land value taxes don't discourage desirable behavior when raised. Property taxes might discourage construction but if land values are high enough then property taxes approximate land value taxes. Raising income tax on the other hand discourages working even when it is set very low. This is one which ought to be lowered if anything. tl;dr it doesnt work the same way for every tax.

>Land value taxes don't discourage desirable behavior Are you serious? LVTs expressly incentivizes landlords to kick out "grandfathered in" developments and uses in favor of redevelopment and sale for that purpose. But those grandfathered in developments and uses are exactly what made the place valuable in the first place and you need some amount of them to remain.

Redevelopment often mitigates housing scarcity in general, including for existing residents. They may have to move to a slightly smaller apartment within a generally much improved area, which usually leaves them better off. This is especially true for LVT, which amounts to a decrease in property tax for the improvements to land.

Re: New York passes pied-a-terre tax

#242

Post by jdappletini »

everdrive wrote: post #53
robbiewxyz wrote: post #46

Earlier quoted context omitted.

For startets, the revenue raised makes NYC as a city more sustainable by funding social programs for the normal people who keep the lights on.

Thanks, I feel sort of stupid for failing to notice that it would if nothing else just increase tax revenue. I was stuck in a perspective that this was about increasing housing stock.

Yeah Mamdani is firing on all fronts.

There is plan to add to the housing stock as well: https://www.nyc.gov/mayors-office/news/2026/05/mayor-mamdani...

He is also aggressively going after landlords withholding repairs, maintaining dilapidated units, etc. and thus tackling the quality of the housing stock problem.

Re: New York passes pied-a-terre tax

#244

Post by mikhailfranco »

gruez wrote: post #167
SoftTalker wrote: post #135

Earlier quoted context omitted.

I would disagree, I think income taxes and inheritance taxes are morally wrong. Earning money to support oneself and family instead of relying on public largesse should not be taxed. Passing the fruits of a lifetime of work to ones heirs so they can continue do productive work instead of relying on public largesse should not be taxed.

>I would disagree, I think income taxes and inheritance taxes are morally wrong. So what taxes aren't "morally wrong"?

Consumption taxes and sin taxes.

Consumption tax is sales/VAT tax excluding some necessities and capital goods. Yes, there are some awkward edge cases: in the UK the exclusions were food and children's clothes, which leads to battles over prepared cold food (e.g. sandwich), takeaway and restaurant dining.

Sin taxes are obviously things society might want to discourage, mainly for health reasons, like alcohol and smoking, but also gambling and externalities, like pollution. Some might stretch that to all carbon emissions to moderate climate change.

Don't tax things you want: working / income and investment / capital gains.

Inheritance tax is doubly wrong because the wealth is already taxed, and death is unavoidable (but emigration is possible, which might help in some countries).

Re: New York passes pied-a-terre tax

#245

Post by wsve »

zthrowaway wrote: post #101
blitzar wrote: post #42

Earlier quoted context omitted.

The elites always promise us trickle down economics, maybe this time it will happen. I wont hold my breath though.

Trickle down economics is a political label to criticize Reagan era policies, it’s not an actual thing.

It's a label for a very real tax policy and the advertised reason behind it, it's definitely a thing (or was, at least, the argument is less common today)

Re: New York passes pied-a-terre tax

#246

Post by rdtsc »

It's a good thing to try, we'll see what happens. It's interesting to see the CEO immediately threatened to pull jobs and move them to Miami. That's to be expected to some degree. The way it works that sometime a small hike is enough to trigger the behavior. It could be in protest or as a sign of more tax hikes to come.

This is also some opportunity for intra-state and intra-city arbitrage where random cities and states lean into the controversy and start offering tax incentives for the "sad" and "offended" egos of wealthy of NYC to move there. That often happens to companies, where states, sometimes down South offer such "deals" to move company headquarters from higher tax states up North.

But at the same time, this might encourage some wealthy people who "fled" to Florida to return back and make New York their primary residence.

I also see slew of loopholes popping up, couples divorcing so each can claim on of the residences as "primary"

Re: New York passes pied-a-terre tax

#247

Post by DocTomoe »

ndiddy wrote: post #75
DocTomoe wrote: post #26

Earlier quoted context omitted.

In reality, they will now just create a company in Singapore or Mongolia or another such place, which will then own the second home - while itself being owned by the original owner. Problem solved significantly cheaper than this new tax. In fact, I would not be surprised if they have already done that four months ago, when the law was being discussed. The ones who will be hit are those who do not have the legal frame…

Isn't that a good thing? It would encourage Joe Homeowner to sell the house to someone who could use it as a primary residence rather than leaving it empty and speculating on the real estate value.

Joe Homeowner already is incentivized to sell grandma's home. Homes need upkeep. No-one keeps an old home around to rot and fall down - that tends to bee bad for the evaluation. The issue is that those who can't finance a primary residence now won't be able to finance a primary residence then.

Re: New York passes pied-a-terre tax

#248

Post by wsve »

harmmonica wrote: post #130
blitzar wrote: post #42

Earlier quoted context omitted.

The elites always promise us trickle down economics, maybe this time it will happen. I wont hold my breath though.

I think this is sarcasm, but in case it's not isn't this the opposite of trickle down? Trickle down means lower taxes for the wealthy so they'll then have access to those extra funds to create jobs (through direct and indirect actions (investing in their companies, buying more stuff, etc.)). This is actually taking money away from the wealthy. If this works (meaning NYC gets the revenue without kneecapping those extr…

Yes it's definitely the opposite of trickle down. Higher taxes on the wealthy to reduce income inequality and provide more funding for social programs

Re: New York passes pied-a-terre tax

#249

Post by rrrrrrrrrrrryan »

throw0101c wrote: post #237
burlesona wrote: post #22

Property tax is the workable wealth tax. There's no such thing as a perfect policy, but in the context of NYC this seems worth trying. I'll be interested to see if it helps create some liquidity in the housing market (the goal), or if it only functions as revenue source. One wrinkle I haven't heard much discussion of -- cities respond to incentives too. NYC is a global destination for the mega wealthy. If it turns ou…

> Property tax is the workable wealth tax. There is a difference between property-as-primary-residence and property-as-secondary/tertiary-residence or property-as-proxy-for-parking-money. Property taxes handle the first scenario, wealth taxes handle the latter.

In San Diego we're voting on a new property tax that only applies to nonprimary residences.

The landed gentry want you to believe that they can't be touched unless you're willing to kick your grandmother to the street, but we can absolutely write taxes that apply more narrowly, and sensible tax policy leads to better outcomes and fewer market distortions than hamfisted regulation.

Re: New York passes pied-a-terre tax

#250

Post by DocTomoe »

swiftcoder wrote: post #133
dec0dedab0de wrote: post #85

Earlier quoted context omitted.

That really depends on how you define middle class. I can easily see how someone with a net worth of 100m being considered middle class compared to billionaires.

And here people gave Mitt Romney shit for saying $250k was middle class...

Not middle-class, middle-income.

Also, that was 14 years ago.

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