Tax-Flight Arguments (Still) Don’t Add Up

[Donnachaidh]

http://www.offthechartsblog.org/tax-flight-arguments-still-don%E2%80%99t-add-up/

Two governors are proposing this week to raise taxes on their state’s wealthiest residents. Today, Minnesota’s Mark Dayton proposed higher income tax rates on taxable incomes above $150,000 and a surtax on incomes over $500,000; tomorrow, Connecticut’s Daniel P. Malloy is expected to propose a higher rate on incomes over $1 million.

Some critics will surely claim, as they have in other states, that higher-income people will flee from the state. No such flight has occurred in other states that raised top rates, but that won’t stop these attacks, as some recent examples show:

* A Bloomberg News story headlined “New Jersey Population Growth Slows as Taxes Push Some to Flee” noted that the Garden State’s population grew much more slowly between 2000 and 2010 than most other states. It suggested that New Jersey’s top income tax rate — now 8.97 percent — was to blame.

But the 8.97 percent rate affects only a tiny share of New Jersey filers — the 1.2 percent with taxable incomes over $500,000 — and those folks aren’t leaving. Quite the contrary, there’s strong population growth within that bracket: during roughly the same time period (1999-2008), the number of New Jersey filers with incomes over $500,000 grew by more than two-thirds.


More at the link --

[RedCloud]

1. Just charge them a 100% tax to leave state.

[customerserviceguy]

2. You don't have to simply raise the top rate to get people to leave

You just have to raise taxes on the upper middle, when combined with high property taxes and a high sales tax to do that.

Tax flight is real. I get a lot of people who call and tell me their forwarding address for their last bill is south of the Mason-Dixon line.