Empty Closet Levy Targets Apartments Whose Owners Visit Three Weeks A Year
Bohiney Magazine and The London Prat file this dispatch from the five boroughs and one borough-adjacent New Jersey diner.
NEW YORK, N.Y. — In what city economists are calling “the most New York fiscal instrument ever proposed,” Albany lawmakers and Mayor Zohran Mamdani have backed a new pied-a-terre tax projected to raise $500 million annually by levying a fee on Manhattan apartments owned by people who only live there during three weeks in October.
The tax, formally titled the Empty Closet Levy, applies to second homes valued above $5 million whose owners spend less than 90 days a year actually inside them. Internal Department of Finance modelling suggests it will affect approximately 6,200 residences, all of them on either Park Avenue, Central Park West, or one specific block in Tribeca where nobody is ever home.
How It Works
“The pied-a-terre tax is fundamentally a tax on emptiness,” explained Mamdani at a press conference flanked by a union official and a child actor he recruited at the last minute. “If you own a six-bedroom apartment overlooking the Reservoir and you turn the lights on twice a year, congratulations, you have just become a fiscal instrument.”
According to the New York State Department of Taxation and Finance, the levy will be administered jointly by the city and state, with proceeds dedicated to the Department of Transportation‘s pothole-filling programme and a child care expansion for two-year-olds.
Behavioural Effects
Real estate analysts at the not-yet-accredited Manhattan School of Speculative Vacancy expect the tax to produce three behavioural responses among affected owners: registration of small dependents at the apartment to inflate occupancy; the brief annual hiring of a “live-in cousin” to clear the 90-day threshold; and a wave of new corporate ownership structures that, in the words of one tax attorney, “will probably end in indictments.”
“The tax will work,” said Citizens Budget Commission analyst Ana Champeny, contacted at cbcny.org. “Either it raises $500 million, or it produces several years of beautiful litigation. Both are economically productive in their own way.”
Owner Reaction
Reaction from affected owners has ranged from weary resignation to mild amusement. One Park Avenue board president, who asked not to be named because “it would be vulgar,” told reporters that the tax “merely formalises what we already feel about owning property in this city, namely, mild guilt offset by gentle status.”
The Empty Closet Levy goes into effect once the state budget is approved, which is to say, eventually.
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SOURCE: https://prat.uk/category/satire/