I'm pleased to see James B. Stewart of The New York Times -- who's no right-winger, but who's also not exactly Paul Krugman -- looking at the evidence and concluding that, no, the rich do not flee states or countries in droves when taxes are raised. "The Myth of the Rich Who Flee from Taxes" is well worth a read, and well worth sending to all the relatives and friends who regularly send you right-wing e-mail forwards, even though you know they won't read it.
But if the facts disprove the notion that wealthy people flee tax increases, it doesn't seem to matter, because the myth gets the results anti-tax advocates want:
Low-tax advocates like [Fox's Stuart] Varney point to Maryland as a prime example of tax flight. Maryland created a millionaire tax bracket in 2008 with a top rate of 6.25 percent. But a year later, the state reported that the number of millionaires filing returns had dropped by a third, and that total tax revenue from the group fell despite the rate increase. After a chorus of media criticism -- "Millionaires flee Maryland taxes" (The Washington Examiner) and "Millionaires Go Missing" (The Wall Street Journal) -- the state legislature let the increase expire in 2011.So the facts didn't support the fleeing-millionaires stereotype -- but the millionaire tax got overturned anyway. Enjoy your reality, liberals -- we richies got your law overturned anyway.
But a study by the Institute on Taxation and Economic Policy, a nonprofit research group in Washington, found that nearly all the decline in millionaires was the result of a drop in incomes largely attributable to the stock market plunge and recession, and not to migration -- "down and not out," as the study put it.
In 2009, just 364 people in the millionaire bracket moved from Maryland or died (the data didn’t distinguish between the two) -- about the same percentage who disappeared in 2007, before any tax increase. And in 2009, more than 1,500 taxpayers entered the millionaire rolls, either because they earned more or moved to Maryland that year. That data "directly contravenes the notion that changes in tax policy were discouraging the affluent from working hard and earning substantial sums of money, or driving them out of the state altogether," the study concluded.
Bonus value at the link: It's accompanied by a photo of one of the rare actual tax-evaders in the world, Gerard Depardieu, shown with Vladimir Putin. What's striking is that Depardieu now has precisely the same body shape as Chris Christie.
No disrespect intended -- I was a fat kid myself -- but I'm old to remember when a lot of people regarded this guy as a sex symbol.
GOP POV:
ReplyDeleteSTFU Steve M, lest you ruin our efforts!
We try never to let facts get in the way of a great meme!!!
Depardieu FOR PRESIDENT!
How do you say, "Going Galt" in... oh, wait, that's right... he's French!
What was the name of that rich kid from Facebook who took off?
Maybe we can run him in a decade or so. Run him as "Prodigal Galt" returns to fix America!
Yeah, that's got a nice ring to it!!!
As someone who is an amateur naturalist volunteer I've found bird/animal scats (shit) that told me more of substance and value that the GOP tax fantasies.
ReplyDeleteAs an ex-corporate executive I know that state taxes bear little or no influence on business location decisions. There are a myriad of other factors. The biggies are the on going (recurrent), costs. The biggest is the wages bill. And even that has many components that may or may not affect the decision.
A key one is reliability of a work force. Why do you think they put put factories in places where they are the dominant employer (shhh that's a secret) ....captive market oh yes and political leverage.
Logically a few percentage points on tax IS NOT going to off-set the wage bill... it helps but it is far more important to have the power over employees by being the major employer (control over the recurrent cost). It also reduces training cost's and the associated losses to production. Continual top productivity = more profit . certainly more than an itinerant stop, start high absenteeism. Union focus on OH&S and in an environmental argument the power of the corporation has a committed push back force against Greenies and EPA via the seat in congress. Again the aim is uninterrupted production.
To the CEO's and millionaires etc it's a perk.
The GOP doesn't want the general public to wake up to the power of being accounting dodges like having an office in a tax haven and transfer pricing, inter corp loans etc. see Enron
Context is overrated, the headline says it all.
ReplyDeleteDon't worry about drinking the koo-aid, it's in the water.
No fear...
Living proof actors can be serious crackpots.
ReplyDeleteYou can pack on a lot of pounds in 30 years.
ReplyDeletehttp://mubi.com/films/the-return-of-martin-guerre