New York City Mayor Zohran Mamdani presented his Fiscal Year 2027 preliminary budget, outlining what he described as two distinct paths to close a multibillion-dollar deficit while meeting the city’s legal obligation to balance its books. Mamdani argued that raising taxes on the city’s highest earners and most profitable corporations represents the “most sustainable and the fairest path,” warning that failure to address what he called a structural imbalance would result in recurring crises.
“As the mayor of New York City, I have a legal obligation to balance the budget. I will meet that obligation,” Mamdani said, adding that his administration would govern with “seriousness, responsibility, and accountability.”
Mamdani says if Hochul doesn't allow NYC to raise taxes on corporations and highest earners, he will raise property taxes on New York City homeowners. pic.twitter.com/Bm07LxS9OH
— The Post Millennial (@TPostMillennial) February 17, 2026
The first path, which he described as both sustainable and fair, would require structural changes at the state level. Mamdani is calling on Albany to approve a 2 percent increase in personal income taxes on roughly 33,000 New Yorkers earning more than $1 million annually, along with higher corporate taxes on the most profitable companies. He argued that the burden of resolving the crisis should not fall on working- and middle-class residents.
“The onus for resolving this crisis should not be placed on the backs of working and middle-class New Yorkers,” Mamdani said. “If we do not fix this structural imbalance and do not heed the calls of New Yorkers to raise taxes on the wealthy, this crisis will not disappear. It will simply return year after year, forcing harder and harsher choices each time.”
Mamdani framed the proposal as part of a broader recalibration of the fiscal relationship between New York City and the state. He noted that city residents contribute 54.5 percent of state revenue but receive 40.5 percent in return, while the city’s share of the state’s gross domestic product has grown significantly since 2010. “It is time to end the drain,” he said.
If Albany does not approve the proposed tax increases, Mamdani said the city would be forced onto a second path that relies solely on tools within municipal control. That option would include raising property taxes and drawing down reserves, including nearly $1 billion from the city’s rainy day fund in fiscal year 2026 and hundreds of millions more from the Retiree Health Benefit Trust in fiscal year 2027.
JUST IN: "We are forced to raid the rainy day fund, the retiree health benefits trust reserve, and to increase property taxes" — NYC Mayor Mamdani pic.twitter.com/LenWB0zCNl
— Polymarket (@Polymarket) February 17, 2026
“At the heart of this path is a property tax increase,” Mamdani said, describing it as a measure that would effectively impact working- and middle-class New Yorkers, whose median income he placed at $122,000. He called the second path “painful” and said it would be used only as a last resort if state-level changes prove unattainable.
“There is no third option of failing to balance the budget,” Mamdani said, referencing the legal requirement put in place after the city’s 1970s fiscal crisis that mandates a balanced budget.
Mamdani’s emphasis on taxing the wealthy has drawn national attention and criticism. Catholic Bishop Robert Barron, who leads the Diocese of Winona–Rochester, said in a recent video that the mayor’s language echoed themes from Marxist ideology. Barron cited prior statements from Mamdani, including a 2020 social media post in which he wrote that achieving full participation in the economy would require “worker ownership of the means of production.”
A recent statement by Representative Alexandria Ocasio-Cortez illuminates the Marxist ideology which continues to take hold of American politicians. Here are my thoughts. pic.twitter.com/Edgy0smzeb
— Bishop Robert Barron (@BishopBarron) February 16, 2026
Barron said such rhetoric was “right out of the Communist Manifesto” and warned that Marxist systems historically targeted religion. “As a religious leader, this is concerning me quite a bit,” Barron said, urging viewers to pay attention to the language used by political leaders.
Mamdani, who is the city’s first Muslim mayor, first South Asian mayor, first African-born mayor and youngest mayor in more than a century, has maintained that his current budget proposal is rooted in protecting working New Yorkers from bearing the costs of a deficit they did not create. In announcing the state aid package alongside Hochul, he said, “Working New Yorkers did not create this budget crisis and they should not be the ones to pay for it.”
The coming months will determine whether state lawmakers embrace the tax increases Mamdani has proposed or whether the city proceeds with property tax hikes and reserve withdrawals to close the remaining $5.4 billion gap. For now, the mayor has made clear which option he believes offers long-term stability, arguing that without structural change, the city will face repeated fiscal strain in the years ahead.
