Right-wing dogma preaches that hiking taxes on the wealthy will lead the rich to simply move away to find lower tax rates elsewhere. But a new analysis shows that this isn’t necessarily the case.
The San Jose Mercury News conducted an analysis of Internal Revenue Service (IRS) data and found that states with higher taxes actually have the highest number of rich individuals, and that lower-tax states don’t necessarily have as many wealthy people:
An analysis by this newspaper of IRS tax-return data shows that states that charge high income taxes — from California to New York to New Jersey — are home to the highest number of rich people per capita. And two-thirds of the states that don’t charge any income taxes actually have fewer numbers of millionaire residents per capita, the analysis shows.
Consider Florida and Texas, which are often cited as havens for rich movie stars, CEOs and athletes because they are income-tax free. California, on the other hand, has the nation’s second-highest income tax rate.
So in those three states, how many people earn at least $1 million a year for every 100,000 taxpayers?
Florida: 202. Texas: 217. California: 252.
The data seems to debunk the myth that lower tax rates will draw the presence of rich people and that higher tax rates will send them fleeing.
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