By Carol Tannenhauser
When he heard about the forthcoming changes in the Commercial Rent Tax (CRT), levied on businesses in Manhattan below 96th Street, Greg Hunt, the co-owner of Café Tallulah, on 71st and Columbus, said, “That’s fantastic!” and started calculating.
“That’s $15,000 we’ll be saving a year,” he said. “Will it make it or break it for us? No. But this is a classic mom-and-pop shop and $15,000 helps enormously. Rents and everything else are going up. It’s nice to have something going down.”
Hunt was reacting to Thursday’s announcement of legislation passed by the City Council and supported by Mayor de Blasio, “aimed at helping New York City’s small businesses succeed,” according to the city’s website, nyc.gov.
“Effective July 1, 2018, the threshold for Manhattan’s CRT for businesses with income up to $5 million will increase from $250,000 to $500,000 annual rent, with the benefit provided on a sliding scale for businesses with income between $5 million and $10 million or paying $500,000 to $550,000 in rent. In total, the move reduces taxes for 2,700 small businesses, including 1,800 that will no longer pay the tax at all. Under this move, the average business owner will receive between $11,300 and $13,000 in annual tax relief. This represents the first change to the CRT since 2001 and specifically targets Manhattan’s mom-and-pop shops and small businesses, with 99 percent of the benefit going to businesses with only one or two taxable locations. The bill was voted on earlier in the day by the City Council and will be signed by the mayor in the coming weeks.”
As recently as August, the mayor was not such a sure thing. “The legislation is expected to cost the city $38.6 million in foregone revenue in fiscal year 2019,” The Real Deal reported. “This was a sticking point for the de Blasio administration.” But, by Thursday, with enough Council Members behind the bill to override a veto, the mayor said at a press conference, “Anyone with eyes to see knows there is a crisis with our mom-and-pop stores. We have to right a wrong here.”
“It’s wonderful,” said Greg Hunt. “I’m very, very appreciative to the City Council and the mayor for doing this.”
The legislation was introduced in 2015 by Council Member Dan Garodnick of the 4th district. District 6 Council Member Helen Rosenthal, who was co-lead sponsor of the bill, praised his “incredible leadership on this issue.”
Photo via Cafe Tallulah.