Wynn and Ross Sue New York Over Pied-à-Terre Tax
Steve Wynn and Wilbur Ross have sued New York State over its pied-à-terre tax, calling the luxury second-home surcharge unconstitutional.
Casino developer Steve Wynn and former US commerce secretary Wilbur Ross have filed a lawsuit against New York State challenging the city's pied-à-terre tax, the surcharge on luxury second homes owned by people whose primary residence lies elsewhere.
The two wealthy part-time New Yorkers, both Florida residents, argue the levy is unconstitutional because it discriminates against owners who do not mainly live in the state. Their suit was filed in a court on Long Island.
According to the case, Ross — an investor who served as commerce secretary during President Donald Trump's first term — could owe more than $83,000 on his Manhattan co-op. Wynn, who built a luxury casino empire, faces a possible bill exceeding $183,000 for his city residence.
The lawsuit further contends that pied-à-terre owners already pay substantial property taxes and, as wealthy individuals, contribute heavily to the city's charitable and cultural institutions for the benefit of all New Yorkers.
A spokesperson for Governor Kathy Hochul pushed back, saying that when Wynn and Ross cast themselves as sympathetic figures in a fight over paying their fair share on multimillion-dollar second homes, they make the case for the tax as well as anyone could.
Enacting the surcharge marked a major win for New York City Mayor Zohran Mamdani in his push to raise taxes on the wealthy to fund his progressive agenda. Its rollout, however, has been rocky.
The city already faces an earlier lawsuit from a group of homeowners who claim City Hall did too little to determine who would owe the tax, instead leaving residents to work it out themselves. On Tuesday, a judge ruled against the city and ordered officials to restart the process with greater diligence. The city plans to seek a pause on the ruling while it pursues appeals.
"Today's decision is wrong, and we will invoke a stay of the injunction. With a stay, we will continue implementing the surcharge fairly, efficiently and in full compliance with the law, as we have since day one," said Matt Rauschenbach, a spokesperson for the mayor.
The tax is projected to raise $500 million annually for the city by adding a surcharge on one-, two- and three-family homes valued above $5 million, as well as condos and co-ops worth $1 million or more, when they are not a person's primary residence. It applies only to second homes within New York City, not to other wealthy enclaves in the state such as the Hamptons on Long Island, where Ross also owns a home, according to his lawsuit.