Why Mamdani’s Planned Corporate Tax Increase Is “Absolute Suicide” for Business
New York City is staring at a fresh political storm. The incoming head of one of the city’s most influential business groups says Mayor-elect Zohran Mamdani’s push to raise corporate taxes is not a bold policy, but a straight shot at the city’s economic future.
Steven Fulop, who is set to lead the Partnership for New York City in 2025, did not hold back. He said the plan would undermine the city’s competitiveness and give nearby states a clear advantage.
Fulop argues that Mamdani’s proposal is not just a heavy lift. He says it is a direct hit to companies already carrying high costs in a city that operates on thin margins. In his view, the moment New York chooses to impose additional taxes is the moment companies start placing one foot out the door. Even if they do not leave right away, he says they will freeze the growth that sustains the local economy.
Fulop’s Warning and the High Tax Math
Fulop / IG / Fulop, who is set to lead the Partnership for New York City, called the plan “absolute suicide for NYC and an absolute dream for NJ”.
He said companies may try to stay put. But they will stop adding jobs in a city that makes it too expensive to compete. His warning paints a picture of slow but steady economic drift, with companies shrinking their presence instead of expanding it.
Fulop also argues that critics are missing the full tax math. He says the debate often compares New York’s corporate rate to New Jersey’s without adding the city’s own business tax. That extra layer pushes total corporate taxes above 16%. Fulop says this is not a small bump. It is a gulf that sets New York far apart from neighboring states in a way that scares off investors and executives.
Mamdani’s Plan and the Fight Over Affordability
Mayor-elect Mamdani built his campaign on a sweeping affordability agenda. He said the city needs major investments to bring down costs for working families. His answer is a set of tax hikes at the state level that aim to raise approximately $9 billion a year. That money would cover universal child care, free bus service, and a wide range of social programs linked to housing and daily living expenses.
His plan has two key pieces. First, he wants to raise the state corporate tax rate from 7.25% to 11.5%. Second, he wants a 2% surtax on incomes over one million dollars.
Albany Becomes the Battlefield
Mamdani / IG / Business groups across New York City argue that Mamdani’s plan will chase companies to nearby states like New Jersey and Connecticut.
But the plan cannot move forward without Albany. State lawmakers and the governor would need to approve the changes. That sets up a major clash in the coming months. The governor, Kathy Hochul, has already made her stance clear. She opposes broad tax hikes, saying they risk pushing wealthy residents and businesses across state lines.
Hochul’s position puts her in the center of a growing fight inside her own party. The left wing, including the DSA and several state lawmakers, has launched rallies and presented bills to force the issue.
These states already pitch themselves as cheaper offices for companies that want access to the New York workforce without the New York bill. Fulop says that if the tax increase passes, that pitch becomes even more attractive.
The partnership he is set to lead has long played a central role in shaping policy debates. Under his leadership, the group is likely to become even more vocal. Fulop says the moment demands blunt honesty about the risks. In his view, the city cannot afford to lose more jobs or more employers. He says the tax plan does both.