Scott: What percentage of that $2.8 trillion land value would have to be taxed annually to provide the same level of revenues currently in the NYC 2025 budget?
Grok: To determine what percentage of the estimated $2.8 trillion land value of New York City's five boroughs would need to be taxed annually to match the revenue in the NYC Fiscal Year 2025 budget, I'll use the available data on the budget and the land value estimate provided earlier. The process involves identifying the total revenue in the FY 2025 budget, focusing on tax revenues (since a land value tax would be a tax-based revenue source), and calculating the tax rate needed to generate that amount from a $2.8 trillion land value base.
Step 1: NYC FY 2025 Budget Revenue
- Total Budget: The NYC FY 2025 budget (July 1, 2024-June 30, 2025) is $112 billion, as reported by Rosenberg & Estis, P.C.
- Tax Revenue Component: Property tax is the largest revenue source, projected at $33.7 billion, accounting for 44% of all city tax revenue. Total tax revenue can be estimated as:
frac{33.7 text{ billion}}{0.44} approx 76.6 text{ billion}
This suggests tax revenues (property, personal income, business, sales, etc.) make up ~$76.6 billion of the $112 billion budget.
- Total Revenue Context: The remaining $35.4 billion comes from non-tax sources like federal and state aid ($9.6 billion from federal aid alone), fees, fines, and other miscellaneous revenues. For this calculation, I'll assume the goal is to replace all tax revenues ($76.6 billion) with a land value tax, as this aligns with the question's focus on matching "the same level of revenues currently in the budget" and is typical in land value tax discussions, which often aim to replace property or other taxes. However, I'll also consider the full $112 billion budget as an alternative scenario.
Step 2: Land Value Base
- Total Land Value: The estimated land value of NYC's five boroughs (excluding improvements) is ~$2.8 trillion, as calculated previously:
- Manhattan: $2.2 trillion
- Brooklyn: $300 billion
- Queens: $240 billion
- The Bronx: $50 billion
- Staten Island: $50 billion
- Taxable Base: I assume the full $2.8 trillion is taxable annually, though in practice, exemptions (e.g., for public parks, government land) might reduce this slightly. For simplicity, I use the full amount, as no specific exemption data is provided.
Step 3: Tax Rate Calculation
To match the FY 2025 tax revenue of $76.6 billion:
text{Tax Rate} = frac{text{Required Revenue}}{text{Land Value Base}} = frac{76.6 text{ billion}}{2,800 text{ billion}} = 0.027357
Converting to a percentage:
0.027357 times 100 approx 2.74%
To match the full FY 2025 budget of $112 billion (including non-tax revenues):
text{Tax Rate} = frac{112 text{ billion}}{2,800 text{ billion}} = 0.04
0.04 times 100 = 4%
Step 4: Validation and Context
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