Suit Seeks Payment for Real Estate Taxes Going Back to 1993 for Nigerian Building
The City of New York has filed suit in Federal District Court for the Southern District of New York against the Nigerian government. The Nigerian government has failed to pay real estate taxes and other charges for commercial offices and other non-tax exempt spaces in the 22-story building it owns at 828 Second Avenue in Manhattan.
The City is seeking between $4.1 million and upwards of $16 million in unpaid taxes, other charges, and interest from Nigeria.
The building, known as "Nigeria House," is used partially for tax-exempt purposes, including as offices for the Nigerian Consulate and the Nigerian Mission to the United Nations. However, at least since 2002, and the City believes possibly as far back as 1993, portions of the building have also been used for commercial and other non-tax exempt purposes.
In 2003, the City brought lawsuits seeking unpaid real estate taxes on commercial facilities and staff housing against four countries: Turkey, the Philippines, India and Mongolia. The suits against Turkey and the Philippines were settled. The suits against India and Mongolia reached the United States Supreme Court on the issue of the countries’ immunity from suit.
NYC Counsel successfully argued the case of Permanent Mission of India to the United Nations v. City of New York before the United States Supreme Court in 2007. The Supreme Court held that the countries were not immune. In March 2008, the United States District Court addressed the merits of the dispute, holding that staff housing was taxable. India and Mongolia appealed that decision.
Just before the United States Court of Appeals was to hear the appeal, in June 2009, the United States Department of State purported to exempt all staff housing from local taxes.
The City has taken the position that the State Department is not authorized to grant such an exemption. The validity of the State Department exemption of staff housing and the question of whether staff housing is taxable is now pending in the Federal Appeals Court for the Second Circuit.
Mayor Michael Bloomberg said in the press release: "The city will go after every dollar that is owed to taxpayers. We expect foreign governments to pay their fair share of property taxes, just like all New Yorkers do."
Perhaps Mayor Bloomberg will receive one of those emails from Nigeria asking for his bank account numbers so they can transfer the $16 million owed to the city into his bank account. (LOL)
photo source: PropertyShark.com
Mayor Bloomberg's Press Release
©Mitchell Hall 2010
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