Zohran Mamdani’s ‘millionaire home tax’ reveals New York’s big ‘Ghost cars’ problem that many cities in Italy and France are known for
New York City Mayor Zohran Mamdani‘s proposed ‘millionaire home tax’ is drawing attention beyond second-home ownership. By requiring owners of high-value secondary residences to establish whether a property is their primary home, the proposal also highlights a long-running issue of residency claims that overlaps with “garage fraud”. This is a practice in which residents register vehicles in lower-cost states while primarily living and driving in New York.The proposal has renewed scrutiny over so-called “ghost cars” and improperly registered out-of-state vehicles. City data, investigative reports, and enforcement agencies have for years documented vehicles repeatedly appearing on New York streets with out-of-state registrations, mismatched plates, or fraudulent registrations, raising questions about unpaid fines, insurance evasion, and tax compliance.
How New York City Mayor Zohran Mamdani’s proposed tax intersects with vehicle registration
Zohran Mamdani’s proposed pied-à-terre surcharge would apply to qualifying second homes in New York City. To determine whether a property qualifies as a primary residence, homeowners may need to provide documents such as state tax filings or driver’s licence records.That same residency information could reveal discrepancies in which someone claims residency outside New York while actually living in the city and keeping a vehicle there. New York insurers calculate premiums based on where a vehicle is primarily garaged, making false out-of-state registrations, which is commonly known as garage fraud, a recognised form of insurance fraud.According to a Streetsblog analysis of New York City violation data, 20,992 vehicles registered outside New York, New Jersey, Connecticut and Pennsylvania received at least one traffic or parking violation in every quarter of the year, a pattern suggesting many may be driven in New York year-round despite being registered elsewhere.
What investigators found
In 2025, the New York City Council’s Oversight and Investigations Division conducted a survey of more than 3,500 parked vehicles across all five boroughs. Of the 768 non-New York-plated vehicles, almost one in five had licence plates that did not match the vehicle or could not be traced to a valid registration. The report also revealed:
- Vehicles with mismatched or “no-hit” plates owed nearly 2.5 times more in outstanding fines than properly registered out-of-state vehicles.
- Those vehicles paid only 16% of their fines, compared with 63% for vehicles with valid registrations.
- They also recorded 49% more school-zone speeding camera violations and 74% more fire hydrant violations, on average, than vehicles with matched plates.
Investigators further reported that replica licence plates, expired government-issued plates and out-of-state registration services were openly marketed online, making fraudulent registrations easier to obtain.
New York is not alone
New York has increased enforcement in recent years. Governor Kathy Hochul has made ghost plates and registration fraud part of statewide enforcement efforts, while agencies including the State Police, DMV and Thruway Authority have carried out coordinated operations targeting improperly registered vehicles.Similar practices have also been identified elsewhere in the US. California prosecutors have pursued cases involving the “Montana LLC” registration loophole used to avoid vehicle taxes, while Philadelphia has launched dedicated enforcement against ghost cars and fraudulent licence plates.
Italy and France face similar registration schemes
The practice is not unique to the United States. In Italy, authorities have targeted a scheme centred around Naples in which drivers deregister vehicles domestically, re-register them through long-term rental arrangements in Poland and then continue driving them in Italy using Polish licence plates to reduce insurance costs.In 2022, Italian authorities prohibited residents from driving foreign-plated vehicles not registered domestically, but thousands of Polish-plated vehicles remain concentrated around Naples.France has faced a different version of the problem. The country’s state auditor, the Cour des Comptes, estimated that roughly one million illegally registered vehicles are operating on French roads through fraudulent “ghost dealerships” that manipulate the national vehicle registry. The report linked the registrations to unpaid fees, tax avoidance, stolen vehicles and organised crime networks.While the methods differ, the common feature across New York, Italy and France is the use of registration loopholes or false residency claims to reduce insurance costs, avoid taxes or evade enforcement.
