A sliver of NYC's wealthy has unusual rallying cry: tax me more

As New York City Mayor Zohran Mamdani's tax-the-rich plans spark backlash among New York's wealthy, at least one cohort of millionaires is fully supportive of his policies.

The members of the "Patriotic Millionaires" group — who include a Disney heiress, an owner of Manhattan's Flatiron Building and a former BlackRock Inc. managing director — argue that rich residents can afford paying more into city coffers. To them, it's a small price to pay to preserve New York's long-term vitality.

"I've gotten tax cut after tax cut after tax cut. And I never needed any of them," Abigail Disney, whose grandfather Roy co-founded Walt Disney Co. with his brother Walt, said during an interview over Zoom, where a framed original image from the movie Pinocchio was visible in the background. 

Disney, a documentary filmmaker, said that millionaires can afford a 2 percentage-point income-tax surcharge, as Mamdani proposes, if it improves schools and offers free buses and child care. 

"All these things have fallen out from under the middle class  — an education system that works, public transportation, infrastructure, health care," Disney said. 

The group's view illustrates how divisive Mamdani's policies are among the upper crust of New York society. Some, including hedge fund billionaire Bill Ackman, have warned that higher taxes could accelerate an outflow of affluent residents and firms to lower-tax states like Florida and Texas. It's a view echoed by New York Governor Kathy Hochul as well as business advocacy groups. 

"New York is already highly taxed, and as costs rise some people will stay, but others will shift growth elsewhere," said Steven Fulop, president of the Partnership for New York City, a coalition of the city's largest financial, media, real estate and law firms. He said that it wouldn't take many departures for the city to feel the strain. 

Mamdani has proposed raising the highest corporate tax rate by 4 percentage points and income taxes on people earning more than $1 million by 2 percentage points. He says he's open to the idea of a wealth tax, similar to what's being proposed in California, and has threatened to raise property taxes as a last resort if state lawmakers don't provide more funding to the city. 

Almost 35,000 year-round city residents earned at least $1 million in 2023, according to tax data. Of the world's 500 wealthiest people, 17 call New York City home, with a combined net worth of nearly $378 billion, according to the Bloomberg Billionaires Index. Proponents of higher taxes say intangibles like New York's museums, world-class restaurants and elite private schools keep wealthy people in the area. 

Wealthy New Yorkers have an outsize impact on its spending, with the top 1% — those with annual incomes of at least $900,000 — accounting for roughly two fifths of the city's revenue from income tax, according to the New York City Independent Budget Office. 

"I support raising taxes for the 1% and, even more importantly, the top .01%," said Jeffrey Gural, a New York City real estate developer. He said locally, the funds should be used to finance child care.

Morris Pearl, who chairs the Patriotic Millionaires, said he has no plans to leave Manhattan if taxes rise. "I'm certainly not going to move because of higher taxes. That's ridiculous," he said. "I live where I want to live, and so do most rich people."

Pearl was an executive in BlackRock's financial markets advisory group focused on bank bailouts in the U.S. and Europe. After observing a protest during a trip to Greece where he was advising a situation in Athens, he was inspired to work with the Patriotic Millionaires full-time. 

The advocacy group was founded in 2010, when its members urged then-President Barack Obama not to extend tax cuts for the wealthy. It has since expanded to about 300 members worldwide and a budget of $4.5 million, said its founder and president, Erica Payne, a former deputy finance director for the Democratic National Committee. 

Its mission is to press for higher taxes and the redistribution of wealth across a wider swath of the U.S.

"Wealthy Americans like us have rigged the tax code to give ourselves countless handouts, leaving working people paying higher rates than billionaires," the group's website reads, under a banner labeled TAX THE RICH, the rallying cry of left-wing politicians like Vermont Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez.

Pearl said that he pays almost no income taxes because he makes most of his money from investments and inheritances. 

"When you're already rich, you don't need income," he said. "If you don't have income, you don't pay income taxes."

The Patriotic Millionaires are backing a California proposal that would impose a one-time 5% tax on assets held by California billionaires and trusts. 

The group also advocates for raising levies on investment earning and increasing the minimum wage. 

"I want to live in a city that has enough revenue to do all the things that make New York a desirable place to live," Pearl said. "I want the city to be a city where all the people I depend on can afford to live."