Zohran Mamdani, the Democratic Socialist serving as the 112th Mayor of New York City, recently stated that his plans to revive social services without raising taxes on the average New Yorker are now only possible if New York governor Kathy Hochul agrees to raise taxes on the wealthy. The only alternative, Mamdani stated, would be to raise property taxes and raid the city’s Rainy Day Fund. 

“If we do not go down the first path, the city will be forced down a second, more harmful path. Faced with no other choice…we would have to raise property taxes. We would also have to raid our reserves,” Mamdani warned during the press event. 

The first path, which is to raise taxes only on those earning over $1 million per year, is what Mamdani promised voters on the campaign trail. Mamdani’s present roadblock stems from the fact that Governor Hochul has, many times, expressed her unwillingness to raise taxes on high-income earners. When confronted with this reality during the democratic primary election, Mamdani assured voters that he had overcome similar challenges before. 

“In my first year in the state legislature, I came to Albany where we had a governor then who didn't want to raise taxes on billionaires and corporations. That was then Governor Cuomo. And we actually overcame his objections, raised $4 billion in new annual revenue…,” Mamdani said at the time. 

Despite Mamdani’s apparent optimism, the governor seems unwilling to reconsider. After the incoming Mamdani administration noted $12B in funding gaps for the 2026 and 2027 fiscal years, Hochul’s office sent $1.5B in discretionary funding. In an interview on Friday, the governor signaled an unwillingness to provide more funding. 

“I also represent 8.5 million New Yorkers, so we don’t have to agree on what the funding sources are… I will continue focusing with the Mayor on what we can do together. We’ve supported him with $1.5B this week alone to help him with his budget, and the rest he’ll have to work out with the City Council, the Speaker (of the house), and those elected members,” said the Governor. 

Hochul’s aversion toward wealthy tax hikes stems from a fear that such a hike would cause the wealthy to leave the city and state. A 2023 report published by the NYC Comptroller projects outmigration for high-income earners in the case of an income-tax increase on the wealthy.

However, a Fiscal Policy Institute report from October 2025 titled “New tax data confirm tax flight is a myth” contests this conclusion. The FPI report claims that the top 1% of earners are the least likely to migrate, and that 2020-2021 outmigration was caused by the pandemic rather than taxes. It also notes that a 2021 wealthy tax hike did not cause outmigration among top earners. 

Supporters of a wealthy tax hike also contend that the rich will remain in New York for cultural reasons, including Wall Street’s historical and maintained significance as the financial capital of North America. 

A different NYC Comptroller report, published in 2018, warns against raising property taxes, which now seems like the most likely path for the city given Hochul’s stance. The report states that NYC’s current tax system is regressive, placing a disproportionate burden on low earners, and warns that raising the property tax would make this problem worse while failing to account for rising mortgages, stagnating property values, and lower property taxes in surrounding areas. 

Ultimately, Mamdani’s current position is by no means enviable. After a historic campaign and election victory, the Mayor is now facing the challenge of following through on bold promises that he made without the support of those whom he now needs to help achieve them. Whether this early battle will end in an underdog win for the Mayor or an early loss for his approval will be seen.