New York Mayor Zohran Mamdani said Wednesday that the city’s wealthiest residents need to contribute more in taxes to help address the $12 billion budget deficit left by previous administrations.
Speaking with Andrew Ross Sorkin on CNBC’s “Squawk Box” from City Hall, Mamdani said his team plans to be transparent with New Yorkers about budget challenges that have been “hidden from them for far too long.”
The challenge facing Mayor Mamdani is substantial. Earlier this month, NYC Comptroller Mark Levine projected the city will face a $12.6 billion shortfall over the next two fiscal years. That includes a $2.2 billion deficit on the city’s nearly $116 billion budget for fiscal year 2026, followed by a $10.4 billion gap in the following year.
“This is at a scale that’s actually greater than what we saw here in New York City during the Great Recession,” Mamdani said.
He blamed the shortfall on “gross fiscal mismanagement,” pointing to former Mayor Eric Adams and ex-Gov. Andrew Cuomo.
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Mamdani said his plan to tackle the deficit will include finding savings throughout the budget. He cited the Adams administration’s rollout of a “basically unusable” AI chatbot, which reportedly cost around $600,000 to develop.
“I think the scale of this crisis is one where we have to pursue all of these things,” he told CNBC.
“I have to show that the city government is not just serious about public goods, but also public excellence and public efficiency, and so we have to make sure every dollar that’s being spent is actually being spent in a worthwhile way,” he added.
Mamdani, 34, a former state assemblyman and self-described democratic socialist, campaigned on increasing taxes for the city’s highest earners.
He pledged to raise the city’s corporate tax rate to 11.5%, putting it on par with New Jersey, and to impose a flat 2% tax on New Yorkers making more than $1 million a year.
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Mamdani’s rapid rise to prominence, highlighted by his upset victory over Cuomo in last year’s Democratic mayoral primary, has unsettled some members of the city’s business community. Critics warn that his redistribution-focused agenda could pose risks for the nation’s financial hub.
When asked by CNBC about concerns over a potential business exodus, Mamdani pushed back.
“Capital flight is always spoken about whenever we talk about the potential of increasing taxes on the wealthy,” Mamdani said.
He pointed out that the number of millionaires in New York has grown since the state raised taxes on the wealthy in 2021. He emphasized that his revenue plans are focused on improving the quality of city services.
“We’re sitting here right now in one of the coldest stretches in New York City weather history. One of the reasons why the city could start to get back on its feet was because we had a sanitation department that was staffed by thousands of people,” he said.
“That’s only possible when you’re actually investing in public service.”