With regard to the fraud penalties challenged by Mr. Silverstein, the Tribunal again agreed with the ALJ. Although the imposition of fraud penalties imposes a significant burden on the Department to prove that acts

On December 22, 2017, New York City Mayor Bill de Blasio signed local legislation that amends the commercial rent tax law to provide a credit against the tax for businesses that pay an annual rent of under $550,000 and have total annual income of less than $10 million, effective July 1, 2018. Local Law 254.

Under the current law, the commercial rent tax ("CRT") is imposed on commercial tenants that pay an annual rent of at least $250,000 in Manhattan south of the center line of 96th Street. The amended law provides a credit that eliminates CRT liability for tenants that have total annual income of $5 million or less and pay annual rent of $500,000 or less, and reduces CRT liability for tenants that do not meet the above criteria but pay an annual rent of between $250,000 and $550,000 and have total income of less than $10 million. The amount of the credit, which depends on a tenant's rent and income levels, is calculated by multiplying the CRT paid by both an "income factor" and a "rent factor," with the resulting amount being the credit allowed:

Income factor. Tenants that pay an annual rent of between $250,000 and $550,000 and have total income in the immediately preceding taxable year of not more than $5 million will have an "income factor" of one, while tenants that pay an annual rent of between $250,000 and $550,000 and have total income of more than $5 million but not more than $10 million will have a fractional "income factor" of less than one, with the value of the fraction (and thus the credit) increasing at lower income levels and decreasing at higher income levels.

Rent factor. Tenants that pay an annual rent of between $250,000 and $500,000 and have total income of less than $10 million will have a rent factor of one. Tenants that pay an annual rent of more than $500,000 but not more than $550,000, and have total income of more than $5 million but not more than $10 million, will have a fractional rent factor of less than one, with the value of the fraction (and thus the credit) increasing at lower rent levels and decreasing at higher rent levels.

Only tenants that pay an annual rent of between $250,000 and $550,000 and have total income of $10 million or less are eligible for the credit. The credit will be allowed beginning July 1, 2018, and for all CRT tax years beginning thereafter.