New York's 'Death Tax' Overhaul: 50% Estate Tax Rate and Lower Threshold
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New York City Mayor Zohran Mamdani has backed a proposal to overhaul the city's estate tax system, including a 50% top rate and a lower threshold.
The proposal, which surfaced in a memo circulated by the mayor's office, would reduce the estate tax exemption from over $7 million to $750,000 and increase the top rate from 16% to 50%.
The move comes as New York City faces a projected $5.4 billion budget deficit for the fiscal year beginning July 1.
Tax policy groups have weighed in on the proposal, with some arguing that the combined effect of federal and state taxes could push the overall rate on some estates to about 70%.
Supporters of higher estate taxes argue that they can help governments raise revenue and address wealth inequality, while critics contend that steep taxes on inherited assets may discourage investment or encourage wealthy residents to relocate.
