New York Gov. Kathy Hochul and New York City Mayor Zohran Mamdani are proposing a tax on second homes of the ultrawealthy who own posh property in New York City but are not residents. 

The surcharge would apply to all second homes valued above $5 million, and is projected to bring in more than $500 million annually.  

"It is not a tax on residents" 

Hochul is holding firm to her pledge to not add to the tax burden of New York residents. That means no new income and corporate taxes, and the she will not allow the mayor to raise property taxes. 

Mamdani, a democratic socialist, can still claim a victory, however, because rich people will still get hit in the pocketbook - they just don't live here, and they can't vote him out of office. 

"It is not a tax on residents. That is so important. We're talking about people who are ultrawealthy. I mean, there are literally Russian oligarchs buying up properties, driving up the property values," Hochul said. 

At her announcement, Hochul surrounded herself with headlines accentuating multimillion dollar home purchases by the so-called oligarchs despised by democratic socialists like Bernie Sanders and Mamdani to announce her plan for a pied-à-terre tax to help close the city's budget gap. 

"I think there's a logic behind them also contributing to the city, because they're here, because this is a great city and it has so much to offer. But those come at a cost, and I think it's fair to ask them to contribute," Hochul said. 

How the pied-à-terre tax works

Hochul said there are about 13,000 apartments of the ultrawealthy that could be taxed, like one at 220 Central Park South bought by hedge fund guru Ken Griffin for $238 million. 

The pied-à-terre tax will be an annual surcharge on one- to three-family homes, condos and co-ops, targeting non-residents. 

It would apply to homes that aren't primary residences. The tax will ensure owners who don't live in the city or pay city income tax are still contributing to essential services, including policing and parks, Hochul's office said. 

"The measure targets ultrawealthy out-of-city residents and global elites who use New York City real estate as a vehicle for wealth storage rather than as homes," a statement from Mamdani's office said.

Hochul still has to negotiate the so-called "fine print" with the legislature, like how much the surcharge will be, and if there will be a sliding scale depending on how much the second home cost. 

"If you can afford a $5 million second home that sits empty most of the year, you can afford to contribute like every other New Yorker," Hochul said in a statement.   

A spokesperson for the state Assembly told CBS News New York a pied-à-terre tax is something lawmakers have long supported. 

Mayor Mamdani on the idea

Mamdani said he's glad that property can be taxed.

"This is the kind of wealth that is being stored in the city, and it is a residence that is so often empty," Mamdani said. 

While the mayor didn't mention his ongoing demand to tax rich city residents, his fellow democratic socialists took to social media to up the ante. 

"We won't stop until oligarchs & the richest corporations pay everything they owe," New York City Democratic Socialists .  

CBS News New York asked Hochul if the pied-à-terre tax is a way to appease the demands by Sanders and the Working Families Party to tax the rich. 

"I feel no need to appease anyone," Hochul said. 

Mamdani has said taxing the rich is the only way to make up for the city's $5.3 billion budget gap.

"Thanks to the support of Governor Hochul, we are one step closer to balancing our budget by taxing the ultrawealthy and global elites with a pied-à-terre tax -- the first of its kind in our state. Alongside the governor, our administration is fighting every day to make sure we address this fiscal deficit fairly, where the wealthy contribute what they owe and our budget reflects our commitment to the working New Yorkers being priced out of our city," he said in a statement.   

Mamdani previously said personal income taxes on residents earning at least $1 million per year need to be increased. 

Hochul's $260 billion state budget proposal didn't include any broad-based income tax raises. She said it was designed to improve affordability without raising taxes. 

Republican gubernatorial candidate Blakeman speaks out

Bruce Blakeman, the Nassau County executive running against Hochul for governor, slammed the idea.

"Kathy Hochul's 'No Tax Hike' promise has expired faster than the families fleeing New York's affordability crisis. Whether you're affluent or middle-class, Hochul and Mamdani are looking to hike your property taxes and take half your house through a new inheritance tax," Blakeman said in a statement. "It's a war on homeownership and the American Dream. Unlike Hochul, I'll actually keep my word when I'm governor: I'll cut your taxes, slash your utility bills in half, and protect the American Dream."  

The Republican nominee has repeatedly sounded off on Hochul and Mamdani regarding affordability in the state.

"It's no longer affordable to live in New York, and now, under what they proposed, it won't even be affordable to die in New York," Blakeman previously said.  

NYC Council speaker hails proposal

New York City Council Speaker Julie Menin called it a "smart, sensible proposal that will generate significant new revenue to help fund the vital services New Yorkers rely on."

"Coupled with the Council's proposals to secure additional revenue from the highest earners -- including PTET changes and adjustments to the UBT/PIT credit -- this is the comprehensive approach we need to strengthen the City's fiscal footing and tackle the affordability crisis without burdening working New Yorkers," Menin said in a statement.