Former presidential candidate Ralph Nader believes a bill in Albany will answer all the questions about how mayoral hopeful Zohran Mamdani can bankroll his ambitious agenda. The legislation would ostensibly collect an existing state tax on stock trades made on Wall Street to raise billions in state revenue each year.
In a September 9 letter obtained by the AmNews, Nader and several other proponents, including State Assembly sponsor Phil Steck, asked Mamdani to both endorse the legislation as a mayoral candidate and co-sponsor it as a currently elected assemblymember.
“Passage of this legislation will alleviate much hardship and suffering for millions of NYC residents for decades to come,” they wrote. “As you well know, the sales tax had been collected and kept from 1905 to 1981. Then, pursuant to a bizarre deal by former Governor Hugh Carey, the sales tax was rebated to the stockbrokers electronically. Your ambitious programs for New York City need the billions of dollars that ending the rebate could provide. The brokers won’t even miss it. Most of it comes from high-frequency traders anyway.”
Each time a trader makes a transaction on the New York Stock Exchange, the state collects a few cents. According to Steck’s office, the tax amounts 0.1% of each stock sale, capped at $350, so a $100 share purchase would be taxed 10 cents. But the money is returned back entirely, thanks to the rebate established by Carey during a 1970s financial crisis in New York City. Earlier this year, former McKinsey chief economist (and former “Nader Raider”) Jim Henry estimated that around $450 billion has gone uncollected since then.
The tax largely affects high-frequency traders, who employ complex algorithms and supercomputer programs to regularly move stocks en masse in milliseconds. For middle-class investors and pension holders, the tax should be largely nominal, say the bill’s proponents. Other securities, like derivatives or bonds, would be untouched.
Exactly how much money the legislation could raise remains a mystery, but Steck’s office now subscribes to an estimate made by Henry of $60 billion (yes, with a b) each year. This past spring, the AmNews reported a conservative estimate of at least $15 billion to $20 billion.
The bill’s support recently grew with Assembly Majority Leader Crystal Peoples-Stokes signing on as a co-sponsor. Currently, 10 state senators and 38 assemblymembers back the legislation. State Senator James Sanders Jr., a Black veteran representing parts of Southeast Queens, sponsored his chamber’s version of the bill. Earlier this year, he spoke to the AmNews about how the stock transfer tax could recoup money lost from federal budget cuts by the Trump administration.
“There’s no question that any cuts would have a discriminatory impact on communities of color, working-class communities, and immigrant communities,” said Sanders in April. “By taking this money and targeting it to a great degree on areas that those communities need the most, such as education, job readiness, [or] the quality of the neighborhood streets, you will ensure that they have a better standard of living.”
Nader, 91, believes Mamdani’s support should be a no-brainer and previously spoke to his campaign about the issue before falling out of contact. He similarly fashioned himself as a political outsider by relentlessly taking on corporate interests through his cadre of “Nader Raiders” and the think tank Public Citizen.
As a result, the self-identified democratic socialist Mamdani faces a rare critique from the left — Nader commended the assemblymember’s unwavering stance on Palestine despite attacks by the establishment, but questioned whether he planned to take on Wall Street, or if he was “just a regular liberal who knows that the rents are too high.”
“With that background, I sent him a letter that said how could you not support your colleagues in Albany, many of whom have signed on to end this notorious rebate of at least $16 billion a year?” said Nader in a phone conversation. “You have all kinds of programs for New York City, and your critics are saying, how are you going to pay for them? One answer is [to] end the rebate. Pass the legislation in Albany, which earmarks billions of dollars for different sectors — mass transit, education, health, environment — right in the bill, so there’s no ambiguity, and it’s not going to go into the general fund for Gov. [Kathy] Hochul to spend.”
Movement prods New York’s dormant multi-billion-dollar sales tax on Wall Street
Critics for reinstating the Stock Transfer Tax fear the bill will drive the city’s financial heart toward other states, just as they did in 1905
Mamdani’s campaign promises include free buses, no-cost childcare, and a new Department of Community Safety for civilian-led public safety solutions. He reportedly favors a direct wealth tax championed by progressive allies like Sen. Bernie Sanders and Sen. Elizabeth Warren.
Regardless of how Mamdani raises the money, wealthy New Yorkers won’t part with their cash easily. The rich historically threatened to flee New York City over the stock transfer tax, just as they have if Mamdani wins in November. However, the 1% cannot simply escape the stock transfer tax by moving ZIP codes.
Anyone who trades on the New York Stock Exchange is subject to the tax, even foreign entities. Of course, rich New Yorkers, who fund the state substantially through income taxes, could potentially prop up another location, like the newer Texas Stock Exchange in Dallas, but they haven’t done so yet, despite numerous ultimatums dating back more than 120 years. In addition, several stock exchanges, like London and Hong Kong, already levy a stock transfer tax.
While the bill’s sponsors did not reach out to New York City mayoral candidates specifically for their support, Steck penned a separate letter to his state assembly colleagues, including Mamdani.
“Zohran Mamdani was able to successfully beat disgraced ex-governor Andrew Cuomo and incumbent Mayor Eric Adams because he articulated a vision for New York City that makes life easier for the working class and does not cater to Wall Street,” said Steck by email. “While Mr. Mamdani was successful with his rhetoric, he must now show the voters of New York City he will embrace common-sense policy solutions that will benefit the middle class. The best and easiest way he can do this is by endorsing my legislation to reinstate the Stock Transfer Tax.”
If elected mayor, Mamdani would leave his current office before the next legislative session begins. However, his sweeping influence could certainly pressure support in Albany and bring newfound awareness to the stock transfer tax, potentially outsizing the impact of any direct co-sponsorship as a state lawmaker. Despite the bill’s massive revenue potential, the public is largely unaware of the legislation.
In fact, Adams seemed to believe the state already collects the tax. During an early August appearance on journalist Nayeema Raza’s podcast Smart Girl Dumb Questions, he maintained the city could not afford to push out billionaires because “the money we make just on stock transfer taxes and bonuses — that actually impacts our budget.”
The Mamdani campaign did not respond to requests for comment.