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REBNY REPORT: Real Estate Industry Generates $31.9 Billion in Taxes, Helping to Fund Necessary City Services
January 8, 2020
New York City’s real estate industry generated $31.9 billion in taxes over the last fiscal year, representing 53% of the City’s tax revenue, according to a REBNY analysis.
Highlights of the analysis include:
- Real estate related taxes make up 53% of total NYC tax revenue, more than double the next closest contributor (Personal Income Tax made up 21%).
- Of relevant taxes, Real Property Tax was the largest generator of revenue, contributing $28.0 billion.
- Additional revenue from real estate related taxes was generated by Transfer Taxes ($1.4 billion), Mortgage Recording ($1.0 billion), Commercial Rent ($900 million) and Hotel Room Occupancy ($600 million).
- Real estate related tax revenue accounts for 53% of the City’s total tax revenue, an increase from 47% in 2009.
Real estate related taxes remain a key source of funding for the five boroughs. The revenue could fund the City’s entire share of salaries for all 300,731 full-time city employees which totaled $29.03 billion in FY2019.
“This report demonstrates the importance of real estate related tax revenue to our thriving city,” said James Whelan, REBNY President. “A healthy real estate industry is vital to the health of the city, as real estate related taxes make up more than half of all taxes collected. This revenue supports the city’s share of salaries for every single police officer, firefighter, and schoolteacher with billions left over to pay for parks, libraries, and other critical public services that every New Yorker enjoys. If we want a progressive city, then we need a prosperous city. These findings underscore that policies that limit the amount of tax revenue generated by our industry are counterproductive to improving the lives of New Yorkers they aim to help.”
The $31.9 billion in taxes come from properties such as office and residential rental buildings, hotels, retail stores, and utility properties and do not include one-and-two family homes, cooperatives, condominiums, schools, hospitals, and other publicly funded structures. Mansion tax information will be available beginning in FY2020.
The report highlights the critical relationship between New York City’s overall economic health and the health of its real estate industry, which serves as the “invisible engine” powering the continued growth of the city.
REBNY analyzed public information compiled in the New York City Comptroller Office’s Annual State of the City’s Economy and Finances report and NYC’s Comprehensive Annual Financial Report. Read our analysis here.