Taxes and Commercial Real Estate Activity in NY

Today's NY Sun has an interesting article sure to reinvigorate the timeless intellectual arm wrestling about whether booms and busts in real estate are primarily driven by tax policy or the business cycle.

This article focuses on the infamous "Cuomo Tax", formally known as the Real Property Gains Tax, enacted in the '80's by then Governor Mario Cuomo. In short, the tax that excluded townhouses and one and two family houses, surcharged capital gains on most other commercial property transactions above $1,000,000 by 10%, preceded a slowdown in the NY marketplace.

Its repeal by Cuomo's successor, George Pataki, either coincided with or caused the beginning of the most recent boom in New York commercial real estate, depending on your philosophy.

Read about both sides of the issue in David Lombino's piece at http://www.nysun.com/article/34784?page_no=1