Albany Lawmakers Push Bill to Allow NYC Mayor to Impose 25% Corporate Tax Surcharge

Measure backed by democratic socialist Mayor Zohran Mamdani aims to hike taxes on corporations to fund city's agenda

Mar. 2, 2026 at 8:47pm

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New York state lawmakers have introduced legislation that would give Mayor Zohran Mamdani the power to impose a 25% tax surcharge on corporations in New York City. The democratic socialist mayor and his liberal allies have been pushing to raise taxes on the wealthy and corporations to fund their ambitious policy agenda, including new social programs. However, business groups warn that such a steep tax hike would make the city uncompetitive and drive companies to relocate to neighboring states with lower corporate tax rates.

Why it matters

This proposed corporate tax surcharge is part of a broader ideological battle between the mayor's progressive agenda and business interests in the city. While the mayor argues that corporations should pay more to address affordability issues and fund public services, critics contend that such a dramatic tax increase would damage the city's economy and competitiveness.

The details

The bill, sponsored by Assemblywoman Diana Moreno and Senator Kristen Gonzalez, would authorize New York City to impose a 25% surcharge on corporate taxes. The lawmakers argue that this would allow the city to increase corporate tax revenue to address affordability challenges and fund public services. However, the bill does not specify how much revenue the surcharge would generate. Business groups counter that the city's current combined corporate tax rate is already significantly higher than neighboring states like New Jersey, and that a further 25% hike would make the city uncompetitive and drive companies to relocate.

  • The bill was introduced in the New York State Legislature in March 2026.

The players

Zohran Mamdani

The democratic socialist mayor of New York City who has been pushing to raise taxes on corporations and the wealthy to fund his policy agenda.

Diana Moreno

A democratic socialist Assemblywoman who was elected to fill Mamdani's former seat and is co-sponsoring the bill to allow the mayor to impose a corporate tax surcharge.

Kristen Gonzalez

A state Senator whose district covers parts of Western Queens, Northern Brooklyn and the East Side of Manhattan, and who is co-sponsoring the bill with Assemblywoman Moreno.

Kathy Hochul

The Democratic Governor of New York who has said she opposes any broad-based tax increases this year, though it's unclear if she would bend to pressure from her party's progressive wing after the November elections.

Steve Fulop

The new CEO of the Partnership for The City of New York, a business advocacy group, who has criticized the proposed corporate tax hike as making New York City uncompetitive compared to neighboring states.

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What they’re saying

“This legislation would authorize New York City to charge a surcharge on corporate taxes, allowing the city to increase its corporate taxes should the mayor and City Council deem this necessary and appropriate.”

— Diana Moreno, Assemblywoman

“Revenues generated from a corporate tax could contribute to addressing the affordability crisis and strong public services for residents of the city.”

— Kristen Gonzalez, State Senator

“New York City is home to dozens of Fortune 500 companies. Yet, for corporations with over $5 million in annual profits, the corporate tax rate is only 7.25%, significantly lower than neighboring states like New Jersey, which is set at 11.5%.”

— Diana Moreno and Kristen Gonzalez

“I don't think the tax conversation is productive because we are going to be 100% higher than New Jersey if we take that proposal. New Jersey's current corporate tax rate is 11%. If we do what the mayor has recommended, will be at 22% – 100% over New Jersey. People don't have to move to Texas or Florida. They can just move a mile away, which is a real risk for the economy here in New York.”

— Steve Fulop, CEO, Partnership for The City of New York

“Raising taxes makes New York even more expensive for people we want to come and stay here, people whose taxes support our teachers, cops, libraries, health services and more of what we all need. New York and its localities are already top of the charts–collecting more taxes per person than anywhere else in the nation.”

— Andrew Rein, President, Citizens Budget Commission

What’s next

The bill must pass the New York State Legislature and be signed into law by Governor Hochul before the mayor could implement the proposed 25% corporate tax surcharge.

The takeaway

This battle over corporate tax hikes highlights the ongoing tension between the progressive agenda of Mayor Mamdani and his allies, and the concerns of the business community about New York City's competitiveness and ability to attract and retain companies. The outcome of this debate could have significant implications for the city's economic future.