New York Mayor Zohran Mamdani unveiled two budget proposals to address the city’s growing deficit: raising taxes on the wealthiest residents and corporations, or, as a last resort, a 9.5% property tax hike affecting millions of homes and commercial properties.

Mamdani emphasized that taxing the wealthy is the fairer and more sustainable option, warning that relying on property taxes and reserves would burden working- and middle-class New Yorkers.

Governor Kathy Hochul has ruled out income tax increases but pledged $1.5 billion to help reduce the city’s deficit, which is projected to rise to $7 billion over two years.

City lawmakers and officials, including Council Speaker Julie Menin and Queens Borough President Donovan Richards, strongly opposed the property tax hike, calling it regressive and harmful during an affordability crisis, The Guardian has reported.

The proposals mark the beginning of a likely prolonged negotiation between Mamdani and the city council to finalize the budget.