Will Mamdani’s Tax the Rich Plans Send New York’s Art Money Packing? London’s Own Millionaire Flight Offers Some Clues

Against a backdrop of insane auction results in New York, the city’s mayor Zohran Mamdami has been meeting with top financial executives this week as he tries to contain the backlash over his “happy tax day” proposals. 

Republicans and business leaders have warned that if the democratic socialist won the mayoral election and imposed policies like a "pied-à-terre tax" targeting ultra-luxury second homes, the rich would depart New York in their droves.

However, six months after Mamdami’s win, and a month after anointing April 15 as the city’s “tax day”, there’s no hard evidence of a millionaire exodus since he took office. 

Yet, depending on who you talk to, the well-heeled are still either fleeing or digging their heels in and staying put. Both sides of the political aisle apparently view the narrative as a sitting duck; catch it and control it. Fox News’ Liz Peek, for example, claimed yesterday that New York has recently “lost up to $15 billion in revenues because of high-net-worth people leaving”. She neglected to cite the source for her data. 

Some big artworld names, including the mega-collector Ken Griffin, reportedly said his multi-national hedge fund, Citadel, would prioritise growth by relocating to Miami after clashes over Mamdani’s progressive taxation plans. Other big cheeses of the financial world have also publicly discussed shifting their organisations to lower-tax states like Texas and Florida, with politicians in those states trying to entice New York businesses.

Despite this, Manhattan’s luxury real estate market has held up surprisingly well since the 2025 mayoral election, with Olshan Realty’s year-end luxury report showing around 1,436 contracts for homes priced above $4 million in 2025, up about 11% year-on-year, and nearly $12 billion in total luxury deal volume, alongside tightening inventory at the top end of the market. Economists and tax-policy researchers have also argued that fears of mass millionaire flight after tax increases are overstated.

However, Phillip Hoffman, chairman and founder of The Fine Art Group, does think the rich are upping sticks from New York. He told me “tonnes” of his clients have already left, and are mostly choosing Palm Beach in Florida, where there’s more millionaires per square mile than anywhere else. Hoffman also said collectors are choosing nearby Miami, Austin, Dallas and Aspen.

It’s worth noting that Mamdani’s administration is still relatively new and many of his proposed tax policies either haven’t fully taken effect or are still being negotiated. It usually takes years, not months, to see clear migration trends in IRS or census data.

Still, plenty of money is obviously sloshing through the top end of New York’s art market. On Monday, Christie’s sold more than $1 billion of art in a double-header sale that saw several records broken, including a Jackson Pollock painting that went for $181.2 million. Pure profligacy. Later in the week, Sotheby’s and Phillips registered more measured results, $303.9 million and $115.2, respectively. Of course, not all buyers were based in New York, but the likes of hot shot dealer Jefferey Deitch were spending big; he snapped up four works to the collective tune of around $60 million.

It remains to be seen if New York’s auction market will be impacted by Mamdami’s policies, but the top end is now booming after several sluggish years. The recovery was cemented last autumn in New York, when Sotheby’s stole the show by selling Gustav Klimt’s Portrait of Elisabeth Lederer sold for a record-breaking $236.4 million.

David Shrader, Sotheby’s former head of private sales who recently joined forces with Pace Gallery and Emmanuel Di Donna to form a new joint gallery devoted to secondary-market sales, told me “there will always be a flow of people from high tax jurisdictions to low tax jurisdictions".

“When you have this arbitrage situation, as we’ve seen in New York and London [which recently scrapped its non-dom status], you’re going to have an outflow”, he said. “But I don’t think this is going to negatively impact New York’s art market. People will always come here to buy art, they just might not choose the city as their primary residence”.

Remember that the art market is highly global, with buyers regularly purchasing works in major hubs like New York and London regardless of where they live. Collectors, investors and institutions increasingly transact across borders through auctions, galleries and private sales.

Speaking of London, this is one major art capital that is genuinely hemorrhaging millionaires – and collectors. 

At the beginning of last year, the Labour government binned its rules for UK residents whose permanent homes are outside the country for tax reasons, also known as non-doms. These residents are now required to pay tax on income regardless of where they earned it. The Treasury predicts the move will raise £33.8 billion over the next five years, but several dealers in London told me they were worried the move would push their wealthy collectors to take their art buying elsewhere, like Italy. Giorgia Meloni’s government is now offering a flat tax rate of €300,000, and much ink has been spilled over how this could boost Milan’s collecting scene. Singapore, Dubai and, ironically, New York are the cities often cited to most benefit from the London exodus.

The wealthy have been departing London at quite a clip; a 2024 report by investment migration advisers Henley & Partners and global analytics firm New World Wealth found that over 10,000 millionaires (including 78 centimillionaires and 12 billionaires) departed the country in 2024, a 157 percent increase from 2023. Meanwhile, UBS’s 2024 Global Wealth Report predicts that 500,000 millionaires will leave the country by 2028. (The Henley report defines a millionaire by liquid net worth, while UBS includes assets like art and property.)

But take a quick glance at London’s recent auction results and things appear pretty rosy. In March, the house registered a ‘white glove’ result – meaning all works were sold – for its modern and contemporary evening sale, taking a total of $154 million. Christie’s equivalent sale the same week, a triple-header, took a  massive £197.5 million. Sotheby’s result marked a 110 percent year-on-year increase, while Christie’s was 52% higher than the previous year. 

On the surface, London’s market is flying, but the high-end auction game is only one layer of the market. For a picture of its overall health, and this applies to New York as well, it’s vital to analyse the bulk, which is effectively works worth less than £1 million sold by galleries at art fairs and privately. Dealers in both cities are finding it difficult to shift work at this price range, with collectors either spending less or taking longer to decide if they want a work or not. The results is galleries closing altogether. These conditions, though, are being whipped up by geo-political uncertainty like the raging wars in Ukraine, Gaza, and the Middle East. Interest rates, turbulent business conditions, less speculation and demand shifting away from emerging artists are also all playing a part.

I asked Jo Stella-Sawicka, a senior director at London’s Goodman Gallery, if Labour’s tax policies are negatively impacting the city’s gallery market. “Of course, ask any dealer, they will all agree,” she said. 

Offering a more optimistic outlook was mega-dealer Thaddeaus Ropac, who earlier told me that while his London gallery has felt the impact of some of his UK-based clients changing their address, the city remains “a critical mass.” He said he does not expect a “big change” in the London art market’s overall sales activity: “Collectors will always come to London.”