The NYT alleges that the claim that higher tax rates will drive rich people to lower tax jurisdictions is, well, "bogus." Refuting the argument matters for advocates of steep taxes on the rich, because people who argue for low taxes deploy the risk of "tax flight" to convert centrists to their side.
The notion of tax flight “is almost entirely bogus — it’s a myth,” said Jon Shure, director of state fiscal studies at the Center on Budget and Policy Priorities, a nonprofit research group in Washington. “The anecdotal coverage makes it seem like people are leaving in droves because of high taxes. They’re not. There are a lot of low-tax states, and you don’t see millionaires flocking there.”Well, maybe, but I had coffee yesterday here in Austin with a realtor who specializes in very high end homes. His experience, especially recently, strongly suggests that Mr. Shure might qualify his opinion just a smidge.
CWCID: TaxProf.
Let's see...
ReplyDeleteMy American-born daughter left the U.S. My American-born brother left the U.S. My closest American-born friend left the U.S. (The friend was a highly successful entrepreneur who retired at the age of 36. Afterward, he taught classes at Harvard Business School for a number of years.)
Meanwhile, Jim Rogers (see his new book "Street Smarts") moved in Singapore. Eduardo Saverin, the billionaire co-founder of Facebook, renounced his U.S. citizenship and moved to Singapore, too.
I can go on and on.
- DEC (Jungle Trader)
Correction to my previous post: Rogers moved to Singapore, not "in" Singapore.
ReplyDeleteDEC, did your family/friends renounce their citizenship or are they still within the grasp of the IRS?
ReplyDeleteThe US remains a pretty competitive place from a tax perspective if you can derive your income through capital gains. However, if you are a high income earner but stuck in the working world of ordinary income the US is not particularly competitive.
Anon Attorney has seen several of his professional acquaintances with portable practices leave the US for SE Asia and South/Central America. If present trends persist I expect to join them in 5-10 years.
To Anonymous:
ReplyDeleteMy daughter and brother remain U.S. citizens (at least for the time being). My closest American friend (old Boston family) changed citizenship.
One need only look at all the people who work in New Jersey but live in Buck's County, PA. They endure a brutal commute for essentially one reason, a much lower tax rate afforded by the treaty between the two states.
ReplyDelete