Khaberni - New York City Mayor Zahran Mumtaz called for increasing taxes on New York's wealthy, in his first confrontation with them to fulfill the pledges he made during his election campaign.
In his testimony before a state senate session to discuss the 2026 budget, Mumtaz, a Democrat, said: "I believe that wealthier individuals and more profitable companies should make.. larger contributions to allow everyone to live with dignity."
He added "For this reason, I am requesting a 2% increase in personal income tax on New York’s wealthiest residents, alongside an increase in the corporate tax rate."
Mumtaz proposes a 2% tax increase on New York residents earning more than a million dollars annually, and an increase in the New York corporate tax rate from 7.25% to 11.5%.
Budget Deficit Reduction
Mumtaz, who will issue the city's preliminary budget next Tuesday, aims to reduce a massive budget deficit exceeding 12 billion dollars, inherited from his predecessor.
He explained in his testimony that the city's budget deficit decreased from 12 billion dollars to 7 billion through "taking a tough stance on savings without compromising city services"
In an interview with Andrew Ross Sorkin, co-anchor of the "Squawk Box" program on CNBC, from city hall, Mumtaz said: "It's a deficit that exceeds in size what we have seen here in New York City during the Great Recession."
The Democrat, who took office on January 1, after an election campaign where he pledged to raise taxes on the wealthy, pointed out that the significant deficit was due to "severe financial mismanagement".
He noted that decisions made by former Mayor Eric Adams, as well as previous New York Governor Andrew Cuomo, who he notably defeated in the general election in November, contributed to the budget gap.
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Transparent Management
Mumtaz pledged that his administration would be transparent with New Yorkers about long-hidden budget issues.
The city's comptroller, Mark Levin, said earlier this month that the new mayor is facing a budget deficit expected to total 12.6 billion dollars over the next two fiscal years.
This includes a projected deficit of 2.2 billion dollars in the fiscal year 2026 budget, totaling about 116 billion dollars, ending on June 30, plus a gap of 10.4 billion dollars in fiscal year 2027.
On Wednesday, Mumtaz said his plan to address the deficit would also include finding savings within the budget.
He continued: "I need to show that city government is not only serious about public services but also about excellence and efficiency in the public sector, which is why we must ensure that every dollar spent is truly spent effectively."
Mumtaz's Rise
Mumtaz's rapid rise to prominence after his surprising victory over Cuomo in the Democratic primary for the mayoral position in 2025, along with identifying himself as a "democratic socialist," has raised concerns among some business elites in the city.
A number of these leaders have warned that his agenda based on redistributing wealth could weaken the city, which is the financial capital of the United States.
When Sorkin asked him on Wednesday about concerns of billionaires and other wealthy individuals and companies migrating under his policies, Mumtaz dismissed these concerns.
He said: "It is always talked about capital flight whenever we discuss the possibility of increasing taxes on the wealthy."
He pointed out that the number of millionaires in New York has increased since the state raised taxes on the wealthy in 2021.
Mumtaz emphasized that his plans to increase revenue aim to improve the quality of city services.
The mayor said: "We are sitting here now in one of the coldest periods in the history of New York City weather."
He added: "One of the reasons the city was able to get back on its feet was having a sanitation department that includes thousands of employees."
He continued: "And this is only possible when you actually invest in public service."
Meanwhile, Rich Azzopardi, spokesman for Cuomo, said in a statement to CNBC: "Zahran Mumtaz needs to learn that holding an executive position means more than wearing a specially designed sports jacket; it requires a fundamental understanding of the facts: under Governor Cuomo's tenure, state aid for New York City schools increased by 68%, and the state bore billions of dollars in increased costs for the city's Medicaid program."
Azzopardi added: "Andrew Cuomo inherited an 11 billion dollar deficit when he first took office and managed to close it through hard work and financial discipline — words that are not in Mumtaz's vocabulary."
