NYC Mayor Mamdani Seeks Tax Hikes on Millionaires to Plug Budget Gap

Mamdani urges state lawmakers to allow him to raise taxes on top earners and corporations to fund his agenda and address inherited deficit.

Published on Feb. 12, 2026

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New York City Mayor Zohran Mamdani traveled to Albany on Wednesday to plead with state lawmakers for help plugging a multi-million budget gap. The Democratic socialist mayor is seeking to raise personal income taxes by 2% on those earning $1 million or more per year, as well as increase the combined corporate tax rate to over 22%. Mamdani claims the tax hikes are needed to reduce a deficit he "inherited" from former Mayor Eric Adams, but the new funding would also be used to help pay for free bus service, tuition-free college, and other campaign promises.

Why it matters

Mamdani's tax hike proposals face opposition from New York's business community, which has warned that raising taxes on the city's top earners and corporations could prompt an exodus of employers, ultimately hurting the city's economy. Governor Kathy Hochul has also rejected the idea of allowing New York City to raise taxes on the wealthiest residents, calling it a "non-starter".

The details

Mamdani is seeking a 2% increase in personal income taxes on those earning $1 million or more per year, which he says would generate an additional $20,000 per top earner. He is also pursuing plans to increase the combined corporate tax rate to just over 22%, which would also require legislative approval. Mamdani claims the tax hikes are needed to reduce a deficit he "inherited" from former Mayor Eric Adams, but the new funding would also be used to help pay for free bus service, tuition-free college, and other campaign promises.

  • On Wednesday, Mamdani testified before a budget hearing at the Legislature's annual "Tin Cup Day" when municipal leaders ask for more funding from the state budget.
  • Last week, Mamdani said the projected budget gap for the next two years could top $12.6 billion, but on Wednesday he told lawmakers that those numbers have been revised down to about $7 billion.

The players

Zohran Mamdani

The Democratic socialist mayor of New York City who is seeking to raise taxes on the city's top earners and corporations to address a budget deficit and fund his progressive agenda.

Eric Adams

The former mayor of New York City, whose administration Mamdani has accused of "negligent budgeting" and leaving behind a financial mess.

Kathy Hochul

The Democratic governor of New York who has rejected the idea of allowing New York City to raise taxes on the wealthiest residents, calling it a "non-starter".

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What’s next

Governor Kathy Hochul will decide whether to approve Mamdani's proposal to allow New York City to raise taxes on the wealthiest residents.

The takeaway

Mamdani's tax hike proposals highlight the ongoing tension between progressive policies and concerns about the impact on the city's economy. The outcome of this debate will have significant implications for New York City's fiscal future and the ability of the mayor to fund his ambitious agenda.