bdog wrote:I don't think we squelch effort and ingenuity by taxing the rich more. We make the rich spend more of that effort and ingenuity to figure out how to get out of paying the higher taxes.
The latest trend: renounce your citizenship
The study, by the anti-tax group Change Maryland, says that a net 31,000 residents left the state between 2007 and 2010, the tenure of a "millionaire's tax" pushed through by Gov. Martin O'Malley. The tax, which expired in 2010, in imposed a rate of 6.25 percent on incomes of more than $1 million a year.
The Change Maryland study found that the tax cost Maryland $1.7 billion in lost tax revenues. A county-by-county analysis by Change Maryland also found that the state’s wealthiest counties also had some of the largest population outflows.
The finding adds to the renewed debate over raising taxes on the wealthy. In New Jersey, Gov. Chris Christie recently vetoed a millionaire’s tax passed by his legislature, while California and other state governments are also considering higher taxes on high earners to fix budget problems. President Obama is expected today to ask Congress to extend tax cuts for those making $250,000 or more – effectively increasing taxes for the higher earners.
Many contend that higher taxes drive out the highly mobile rich, who can simply move to a lower-tax state or even lower-tax country. Recent data shows that a record 1,800 Americans renounces their citizenship last year.
Some argue, however, that there is little real evidence that higher state taxes drive out large numbers of high earners. Neil Bergsman, director of the Maryland Budget and Tax Policy Institute, said while a number of people left the state between 2007 and 2010, others moved in. The net loss, he said, is “very small,” he said.
What’s more, he points out that the wealthy usually move because of a job change, life change or retirement rather than taxes.
“There is no evidence that tax structures are a significant determinant in their location choices,” Bergsman said.
What’s more, he said, Maryland is still minting high-earners and has among the highest incomes and highest concentration of millionaires in the country.
Other studies in New Jersey, Connecticut and Rhode Island have also failed to offer proof that taxes are the main driver of out-migration by the top earners. (See here and here). In some states, weather is a bigger driver of out-migration by the wealthy than taxes.
Still, with top earners paying the largest share of taxes in many high-income states, many politicians don’t want to take the risk of raising tax rates further.
Wisconsin Department of Revenue records show Republican U.S. Rep. Tom Petri did not pay any state income taxes from 2002 through 2005.
Henry Vilas wrote:It isn't just a couple Wisconsin billionaires who pay no taxes. One of their minions in Congress hasn't paid any in four consecutive years.Wisconsin Department of Revenue records show Republican U.S. Rep. Tom Petri did not pay any state income taxes from 2002 through 2005.
Users browsing this forum: No registered users and 3 guests