A temporary restraining order has been issued by Staten Island Supreme Court Justice Wayne Ozzi, halting the implementation of New York City's pied-à-terre tax, which targets luxury second homes. The order prevents the city from proceeding with actions related to 17,000 notices sent to homeowners, which indicated they could incur significant tax bills unless they applied for exemptions. The court hearing regarding the homeowners' lawsuit is scheduled for August 31.
Mayor Zohran Mamdani's administration plans to appeal the ruling. A spokesperson for the mayor stated that they believe in the tax's fairness and effectiveness. The tax, approved by state lawmakers and Governor Kathy Hochul earlier this year, applies to properties valued at $5 million or more that are unoccupied, as well as co-ops and condominiums valued at $1 million or more.
Governor Hochul, while distancing herself from the rollout, emphasized the importance of the tax for wealthy property owners. The lawsuit was initiated by three homeowners who argue that the tax rollout caused confusion and unfairly burdened them. The city has received thousands of submissions challenging the initial determinations regarding primary residences, and city lawyers expressed concerns that the restraining order could delay the processing of these appeals.