NEW YORK (BLOOMBERG) -- Wall Street bonuses and an aggressive savings plan have helped shrink New York City’s expected two-year budget gap by roughly $5 billion, according to Mayor Zohran Mamdani.
“I’m glad to report that by assuming an aggressive posture on savings without compromising city services, incorporating updated revenue and bonus estimates, and using in-year reserves, we have lowered that $12 billion gap to $7 billion,” Mamdani said Wednesday in an address to lawmakers in Albany.
The new deficit estimate marks a major shift as Mamdani prepares to present his administration’s first budget later this month. Earlier this year, Mamdani painted a grim picture of New York’s finances, saying the fiscal situation was in a “crisis.” He still maintains there are challenges, but said his office has made progress in closing the hole.
Mamdani has continued to call on Governor Kathy Hochul to push for higher taxes on wealthy residents and corporations to further shrink the deficit, even as she has repeatedly objected to raising levies. Mamdani asked for a 2% personal income tax increase on the richest New Yorkers. saying that an individual earning $1 million a year can afford another $20,000 in levies.
“That 2% tax would resolve nearly half of our budget deficit. I will continue to advocate for these policies not only because they offer the most direct route out of this budget crisis, but because they will transform what is possible in our state,” Mamdani told lawmakers.
The financial industry is a key contributor to New York’s tax base, accounting for about 7% of the city’s tax revenue during the 2024 fiscal year. For 2025, the five biggest US banks reported a record $134 billion of trading revenue and an upswing in dealmaking. The industry’s bonus pool is expected to reach a record.
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