Wealthy don’t flee from higher taxes

October 17, 2012

Do rising state taxes really cause millionaires to trundle off to more friendly fiscal environs?

Apparently not, according to the findings of two sociologists who will be presenting their findings to lawmakers, lobbyists, reporters and others in a Sacramento appearance on Monday. (UC Davis news service)

The study tracks high-income earners from several states, officials and voters of which have created “millionaire” tax hikes as federal tax rates on those incomes have declined.

Analyzing two recent tax hikes from New Jersey and California, the study’s authors found little inclination of wealthy taxpayers to migrate to lower-tax havens in the face of increasing home-state demands.

The study was conducted by Charles Varner, a doctoral candidate in sociology at Princeton University, and Cristobal Young, an assistant professor of sociology at Stanford University.


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37 Comments

  1. pasoman says:

    Bert,

    From USA Today, Mitt Romney’s taxes, some highlights:

    •Income: $21.6 million for 2010, mostly from investments, and an estimated $20.9 million for 2011.
    •Capital gains taxes: $12.5 million paid in 2010 and an estimated $10.7 million for this year.
    •Charitable donations: $3 million in 2010 and and estimated $4 million in 2011.

    US Spending +/- $5 TRILLION, US population +/- 360 million ($5T divided by 360M = $13,900 per person). So, if we all split this spending pie equally, every man woman and child would owe almost $14,000/year. Get it?

    So, Bert… Mitt paid $10,700,000 one year and $12,500,000 another year. Some think that’s not “fair” enought and he should pay more because he’s “Rich”.

    There are some facts for you Bert. The spending and population are not exact. But they’re close enough for this discussion.

    So Bert, look on your taxes and tell us how much you paid so we can compare Mitt’s paid taxes with yours. Then the rest of us can decide if what you paid is “fair” enough.

    Taking from the rich does nothing for the economy. It just moves money from one person’s pocket to another. It’s nice campaign rhetoric though.

    (2) 8 Total Votes - 5 up - 3 down
    • kayaknut says:

      Amount of tax is not the issue, percentage of tax is, and I bet I pay a higher percentage than Mitt Romney. As long as his percentage rate is the same there would be no problem, income is income no matter where it came from it should all be taxed at the same rate.

      (1) 5 Total Votes - 3 up - 2 down
      • abigchocoholic says:

        Amount of tax is not the issue, percentage of tax is
        ————————-
        Why? Why do you say that?

        The idea of a tax is to pay your share of public things, government, military, hospitals, schools, police etc. If Romney is paying about 10 million dollars a year, how can anyone in their right mind argue that he’s not paying his share? Obviously, he’s paying 1000 times more than his fair share. And he pays more in one year then you could contribute to this country in 100 lifetimes.

        Think about it. Where do you get off telling someone who’s contributing 10 million dollars a year in taxes to this country that it’s not enough? Don’t you basically have to advocate stealing to justify your position? “He has it and we want it so let’s steal it from him”.

        (1) 7 Total Votes - 4 up - 3 down
        • kayaknut says:

          Why should I pay 30% and another person only pay 15%, if we are all in this together, and it is determined that a tax rate of 30% is needed, then anyone who makes the decision to be part of it should pay 30%. Once again some people want to focus on the amount and not the rate. It is great that Mitt has done so well for himself but that doesn’t change the issue that tax rates should be across the board, whether you made 1 million or 1 dollar, it should all be taxed at the same rate.

          (0) 4 Total Votes - 2 up - 2 down
          • abigchocoholic says:

            Why should I pay 30% and another person only pay 15%, if we are all in this together,
            —————-
            Easy answer. Because if you use say $10,000 of services per year you should pull your weight and pay that $10,000. Only if you’re disabled should the rest of us kick in your share.

            Every able bodied person in this nation should pull their weight. Instead we have 47% not pulling any weight. They are in the cart instead of pulling the cart, making the rest of us pull it with them in it.

            But I’ll bet you you’re last dollar those 47% have smart phones and internet and cable and most are overweight etc.

            (2) 4 Total Votes - 3 up - 1 down
          • abigchocoholic says:

            and it is determined that a tax rate of 30% is needed
            ————————————
            I bet you don’t even realize that you argue against the liberal position. Most conservatives would happily agree to a flat tax. No favoritism. Treat everyone the same.

            And even then it’s still anti-capitalistic. When I pay my cable bill, does the cable company get to call me up and say “hey, tell us what you earn and then we’ll decide what to charge you for your bill. And guess what, we’ve decided to give 47% of the people cable for free and we’re heavily in debt so if you make a lot of money we’re going to charge you an absurd rate for your cable to make up for out debt”? No, obviously not. In theory at least, income tax should work the same way. Figure out what public services each person should pay for and bill them for those public services. Pull your own weight rather than voting in politicians who will promise to force other people to carry your dead weight.

            (1) 1 Total Votes - 1 up - 0 down
      • pasoman says:

        Are you serious? Wow.

        If we get the same service, shouldn’t we pay the same amount of dollars for those services? I can’t think of any other places in life where the price of services I pay are based on how much money I make.

        Wow.

        (0) 2 Total Votes - 1 up - 1 down
        • kayaknut says:

          Correct, an neither should the tax rate, whether you made 100 million, 10 milion, 1 million or 10 dollars, it should all be taxed at the same rate

          (-3) 3 Total Votes - 0 up - 3 down
          • pasoman says:

            Flat tax? Hmmmm…. May be a good idea? Then the almost 50% paying nothing now would have some skin in the game. If they would pay something, the “mean rich guys wouldn’t have to pay as much. I like it.

            (3) 3 Total Votes - 3 up - 0 down
    • zaphod says:

      Dwight Esienhower would have to disagree with you, his top bracket was nearly 90% , this was for folks who had government defense contracts the take home was still a fabulous amount even after the 90% tax bite
      this was a time of unprecidented economic growth Esienhowers kept the wealth moving through the sytem
      Regan complained and we cut taxes on these folk and look where it has delivered us on the doorstep of finacial ruin because the stingy prevailed.

      (-3) 3 Total Votes - 0 up - 3 down
      • pasoman says:

        Nice graph. But, that’s about it. DDE. Had a post WWII recovery economy, well documented, with huge demand for anything after years of rationing. Not much you could have done to make an error.

        Today we are in a different global world with global competition. Surely you can see that deficit spending of $1 trillion/yr on top of a $17 trillion debt can be solved by taxing the rich.

        Thanks for the posts, but U.S. capital can, is, and will move offshore. Owners of the capital can still live here. It’s the capital investments here in this country that we need for REAL economic growth and thus jobs. But, if you keep making it harder and harder to do, capitalists will find other opportunities.

        Capital will flow where profits are the highest; just a fact of life from the beginning of time.

        (1) 1 Total Votes - 1 up - 0 down
        • pasoman says:

          Sorry, big whoops… “can NOT be solved by taxing the rich”. :-)

          On my iPad

          (0) 0 Total Votes - 0 up - 0 down
  2. kayaknut says:

    Of course the wealthy don’t flee, several of them are employed locally, SLO city manager for one.

    (6) 8 Total Votes - 7 up - 1 down
  3. Slowerfaster says:

    The rich are skating.They have ‘bought and paid for’ legislators skewing the tax code in their favor.
    They are the BOSSES , and if anyone crosses them, well …count your lucky charms.
    The rich count on hoards of stupid people providing barricades against getting to them….and luckily for the rich, there are plenty of stupid people willing to be fodder for their masters !

    Capitalism is a SHAM. The money manipulators steal whatever they can and leave you PO folk dry. They do it all the time, and you PO folk are too stupid to know you;ve been robbed !

    (-11) 21 Total Votes - 5 up - 16 down
    • doggin says:

      The only ones leaving us “PO” folk dry is our own government. They are the ONLY ones who take what they want, when they want to pay for socialist programs that you apparently survive off Slowfaster. Name one greedy capitalist corporation who I have no choice but to pay off and takes 35% of my hard earned pay.

      (9) 9 Total Votes - 9 up - 0 down
      • The Gimlet Eye says:

        The emergence of economics as a new branch of knowledge was one of the most portentous events in the history of mankind. In paving the way for private capitalistic enterprise, it
        transformed within a few generations all human affairs more radically than the preceding ten thousand years had done. From the day of their birth to the day of their demise, the denizens of a capitalistic country are every minute benefited by the marvelous achievements of the capitalistic
        ways of thinking and acting.

        Ludwig von Mises, The Anti-Capitalist Mentality, p. 34.

        (0) 0 Total Votes - 0 up - 0 down
    • Citizen says:

      So, Slowerfaster, you think that communism and/or socialism will work better than capitalism? Your true colors are revealed.

      (2) 6 Total Votes - 4 up - 2 down
      • zaphod says:

        Capital is the daughter of Labor , And she needs refreshment, want milk? feed cow .

        (-2) 2 Total Votes - 0 up - 2 down
  4. shelworth says:

    It’s not so much income or property taxes that cause people to leave, it’s business taxes. People live where they do because they like it there. But let’s say you own a business in California and you learn you can make the same profit in another state and that state will give you a tax break for moving your business there. Well, where does that extra profit go? Right, into your pocket. Hey, let’s move!

    (14) 20 Total Votes - 17 up - 3 down
    • panflash says:

      Shelworth is correct. And that’s exactly why so many Hollywood film and TV productions are taken out of California to other states and to Canada- to escape the onerous California taxes.
      And then those Hollywood people donate money to, and politically endorse, California Democrat politicians who are responsible for the tax rates.
      And the wheel goes ’round and ’round…..

      (10) 14 Total Votes - 12 up - 2 down
      • r0y says:

        Actually, most of Hollywood originally moved to studios outside CA and the US to avoid union scale pay for the “non-actor” positions. Most post-production is done in Canada because LABOR is far cheaper than CA or any other state in our union.

        There are also onerous regulations in CA that add costs to production. And of course, taxes also play a part.

        (0) 4 Total Votes - 2 up - 2 down
    • Robert1 says:

      I know of a business right now leaving north county for Nevada and the employees can go if they want at lower wages of course.
      Exodus: California Tax Revenue Plunges by 22% , Spectrum Locations Consultants recorded 254 California companies moved some or all of their work and jobs out of state in 2011, 26% more than in 2010 and five times as many as in 2009.
      Derisively referred to as “Taxifornia” by the independent Pacific Research Institute, California wins the booby prize for the highest personal income taxes in the nation and higher sales tax rates than all but four other states.

      http://www.breitbart.com/Big-Government/2012/03/13/exodus-california-tax-revenue-plunges-by-22

      (4) 4 Total Votes - 4 up - 0 down
  5. RayCollins says:

    The ‘rich’ suffering their huge tax fees is a familiar jingle.
    If you are rich, and fed up with the your ‘high’ taxes in California, there are many options outside of our fair state.
    If you wish to enjoy the lifestyle offered to the ‘rich’ in our fair state, then pay the damn taxes and drown your grief in a new Lambo, or some decadent jewelry item.
    Quite a few ‘rich’ folks have properties scattered around the U.S., and likely in a few other nations.
    Best of all, rich folks have economic tools to cloud their true worth and endlessly give the finger to rules.
    Me, I’m just a ‘middle-class’ California native. I love our state, and the good people that still appreciate, and support, our home.

    (4) 18 Total Votes - 11 up - 7 down
  6. Paso_Guy says:

    The government has run out of other people’s money, so it’s a natural to mandate some more from the wealthy

    It’s not that the rich don’t pay enough, it’s that the poor pay mostly zero. No skin in the game.

    (13) 31 Total Votes - 22 up - 9 down
    • The Gimlet Eye says:

      On the contrary, the poor are the most ripped off people in the country.

      (1) 3 Total Votes - 2 up - 1 down
  7. abigchocoholic says:

    People have to come up with a better argument than “the rich don’t pay their fare share”. It’s a non-starter.

    Let’s say a rich guy makes 10m a year and pays only 10% in taxes. What’s he pay a year in taxes? That’s right, one million (1m) a year. (And this is on top of all his property taxes for all his homes and the luxury taxes for his expensive toys.) Now seriously, do you think the 1m covered the rich guy’s’ fair share of schools, police, sewer, emergency room, military, government etc etc.? Obviously it covers it 100 times over. And the rich guy pays that every year. He pays more of his fair share in one year than I’ll pay in my entire life.

    So the argument that the rich don’t pay their fair share is just absurd. They pay 100 times more than their fair share plus your and my fair share and everyone else we know’s fair share.

    (14) 32 Total Votes - 23 up - 9 down
    • Bert says:

      Chock full of…well..not facts or research. Your “argument” posted here lacks any facts and is very shallow and uses completely arbitrary numbers. That’s why I love the posts on this site.

      (-14) 28 Total Votes - 7 up - 21 down
      • r0y says:

        Was this a serious reply? I have to admit, I did actually laugh out loud a little at it, Bert!

        The comment seemed hypothetical to me (the whole “Let’s say…” beginning was a dead give-away). So then the commenter had a basic math sample… then asked if that is “fair” or not. I’m not seeing this “chock full of well not facts or research” – then you lambaste the commenter for using “completely arbitrary numbers” – what else should one use in a hypothetical to ask a question?

        Seriously, every time I see someone complain or over-use the word “facts” – I just assume they’re an ideologue from the left, as that seems to be the “latest buzz word” in shallow arguments. I’m sure the right would do it too, but 9 times out of 10, it’s a “lefty” rather than a “righty.”

        So not only did you fail to answer the question in your reply, but you seemed to pick apart everything in the comment EXCEPT the question posed: Is it a “fair share” for a rich person to pay millions in taxes, which (inferred) is more than a non-rich person pays?

        “Fair Share” only seems to apply when it’s “someone else is not paying enough” for *me* to be satisfied. It’s beating a dead horse, old-school class warfare – used to drum up hatred of “them” so you don’t focus on “us” (whatever ideological encampment that may be). The old “hate them, so you don’t notice how lousy we are” argument.

        (8) 22 Total Votes - 15 up - 7 down
        • Bert says:

          Anyone can create a hypothetical question with hypothetical numbers and manipulate their wording to receive the answer they want. abigchocoholic used numbers that would most likely have people saying ‘wow thats a lot for one to pay relative to people who make a lot lot less’. So why would I or anyone answer the question or give it any sincere thought when problem is that the numbers are not ACCURATE. It’s a bogus situation and a bogus question.

          (-12) 18 Total Votes - 3 up - 15 down
      • abigchocoholic says:

        Your “argument” posted here lacks any facts and is very shallow and uses completely arbitrary numbers.
        ——————-
        It’s called a hypothetical and I used a purposely low tax rate of 10% to prove a point. Doesn’t matter if I use 5% or even 3% because even at 3% the hypothetical has the guy paying 300k a year in just federal income taxes which is probably more than you’ll pay in your entire life total and he’s paying it every year, year in year out! Who do you think I want as my neighbor? Who do you think I want in my tax base contributing to my community, state and country, him or you?

        So one more time, how is he not paying his fair share? Doesn’t 300k a year cover his share of public functions?

        Isn’t the honest response” “Well, he has it and we want it bad and we suspect he probably didn’t earn it all, so we’re just going to take it because, again, we want it bad.”

        (9) 15 Total Votes - 12 up - 3 down
        • Bert says:

          The honest response is “Well, he has it and we want it bad to pay for these wars and if Romney gets in we’ll have one more to pay for and China’s getting tired of loainng us money so lets take it from the wealthy.”

          (-11) 15 Total Votes - 2 up - 13 down
          • abigchocoholic says:

            The honest response is “Well, he has it and we want it bad to pay for these wars
            ———————
            If the rich person is paying at a rate of 10%, he’s paying 1 million a year in income tax, right? How in the world is he not paying his fair share of “these wars”?

            Don’t the 47% not paying any federal income tax benefit just as much from these wars? Don’t these 47% benefit from the U.S. military’s might? How are they paying their fair share for this protection when they pay nothing?

            (6) 12 Total Votes - 9 up - 3 down
            • Bert says:

              You missed the point. These illegal and extremely costly wars should not have ever been started. They do not make America safer or prevent terror, in fact they create more terror. What im saying is the demand for money which is used to help pay for wars while neglecting other essential needs could be reduced heavily without a bill of $19,200,000 per hour. No one id ‘benefiting’ from these wars except those that create arms and sell to the military.

              (1) 1 Total Votes - 1 up - 0 down
          • r0y says:

            Anyone who mentions CHINA loaning us money is a complete fool – Romney included. It’s political hogwash. China owns about 8% of our debt. That is still A LOT of debt: since Feb 2012 China owns $1.132 trillion in American debt, although it is down from all time highs of $1.173 trillion in July 2011.

            Let’s just round that WAY UP to 1.2 trillion. What is our debt again? Oh yeah, 16 trillion… let’s do some math: 1.2 ÷ 16 = 7.5% (actually much less due to my generous rounding UP).

            So about seven (7) cents per dollar of debt is “owned” by China. Go check out the Treasury Bulletin and watch how the Social Security Trust Fund and Medicare Trust Fund own a huge chunk, as well…

            (-3) 3 Total Votes - 0 up - 3 down
    • r0y says:

      With the current budget shortfalls from Local governments, up through State and into the Federal government, there is simply not enough “rich” to tax in order to cover the spending.

      They could take all the wealth of all the people and it is not enough. Seriously, the National Debt is over SIXTEEN TRILLION.

      That is: 16,000,000,000,000 – how much INCOME do you think we ALL have collectively, rich, middle and poor to tax? Even asking an uber-lefty progressive (read: dishonest), Dave Johnson of the Common Weal Institute, wrote:
      …that in 2007, the combined net worth of the 400 wealthiest Americans, as measured by Forbes magazine, was $1.5 trillion; and the combined net worth of the poorer 50 percent of American households was $1.6 trillion.
      In case you don’t have the ability to do simple math, that adds up to 3.1 trillion. So if the government taxed EVERYONE at 100%, we would still be short by $12,900,000,000,000.

      Are we done with the class warfare, yet?

      (7) 15 Total Votes - 11 up - 4 down

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