What happens when you tax millionaires? They leave.

The dems, some at least, are enraged that Obama caved and let the millionaires keep their current tax rates instead of raising them come January 1. Some states, New York, Oregon, and Maryland, I believe, raised taxes on their high-earners and what happened?

They left and now those states are collecting LESS revenue than before.
Rush Limbaugh is an outspoken example of millionaire flight. When the state of New York decided to stick it to him, Limbaugh moved his entire operation to Florida. They continue to audit him but haven’t been able to collect a dime. Limbaugh even sold his New York City condo at a large profit to eliminate having anything left in NY that can be taxed. Where before NY received some income from Rush, now, due to their tax policies, they receive none.

Here’s a cautionary tale from the Las Vegas Review-Journal.


Oregon finds tax doesn’t raise the money

Attempting to close its budget gap without doing what it should have done — cut spending — Oregon raised its “piggy-back” state income tax on the richest 2 percent of its residents last year.
As a result — Nevada legislators, please note — Oregon tax receipts are now … falling.
You can read the entire editorial here.

It seems that millionaires, regardless where they reside, aren’t stupid. Unless they inherited their money, millionaires are some pretty smart folks. They wouldn’t be millionaires if they weren’t. So what happens when the state decides to stick it to their millionaires? They leave—or move their money into areas with a lesser tax rate or perhaps not taxable. Some choose tax defeating alternatives like moving assets into trust funds or out of the state where income derived from those funds are taxed elsewhere. There are all sorts of options and millionaires and their financial advisers are finding them. The new question is, “What does the taxing authority consider ‘taxable income’? What if these assets were owned by a trust, or transferred in some different way … ?”

If BO had followed his party’s demands, I expect that off-shore accounts in the Bahamas and in Switzerland would have been growing about now.

(H/T to George in Las Vegas.)