Supermarkets are trying to shelve a city tax that can cost them tens of thousands of dollars a year on top of their rent bills.
Manhattan Borough President Gale Brewer is pushing a bill that would make supermarkets exempt from the commercial rent tax, which the city charges businesses in prime parts of Manhattan.
“It has outlived its purpose, and now it’s crushing our local businesses,” Brewer said at a press conference Monday outside City Hall.
The tax has been repealed in most of the city but still applies in Manhattan between Murray St. and 96th St.
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The tax applies to businesses paying over $300,000 a year in rent, who pay 3.9% of the rent bill in taxes. Businesses with rent bills between $250,000 and $300,000 also have to pay, but at a lower rate.
Paul Fernandez said he was forced to close the Met Food supermarket he owned in Little Italy, where he was paying nearly $1.1 million a year in rent, plus real estate taxes and another $40,000 in commercial rent tax.
He still runs another Met Food in Chelsea.
“They want to basically take us out,” he said at City Hall Monday.
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“Many stores have closed,” he said. “Now, we are really getting hit from everywhere, and we are having a hard time, so there will be more closures.”
The bill to exempt supermarkets was introduced last spring, and backers hope to pass it by the end of the year. It would cost the city $5 million a year.
“It’s becoming an increasing struggle to even stay afloat,” said Steven Sloan, owner of the Morton Williams supermarket chain.
“This is one more thing we’re dealing with that’s making it harder and harder,” he said of the tax. “It’s getting worse and worse every day.”
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