article: Millionnaires Go Missing

Discussion in 'Economics' started by TraderZones, May 26, 2009.

  1. interesting article - summary - When Md. decide to soak the rich, perhaps up to 1/3 of the rich found ways to not be Md residents any longer


    Here's a two-minute drill in soak-the-rich economics:

    Maryland couldn't balance its budget last year, so the state tried to close the shortfall by fleecing the wealthy. Politicians in Annapolis created a millionaire tax bracket, raising the top marginal income-tax rate to 6.25%. And because cities such as Baltimore and Bethesda also impose income taxes, the state-local tax rate can go as high as 9.45%. Governor Martin O'Malley, a dedicated class warrior, declared that these richest 0.3% of filers were "willing and able to pay their fair share." The Baltimore Sun predicted the rich would "grin and bear it."

    One year later, nobody's grinning. One-third of the millionaires have disappeared from Maryland tax rolls. In 2008 roughly 3,000 million-dollar income tax returns were filed by the end of April. This year there were 2,000, which the state comptroller's office concedes is a "substantial decline." On those missing returns, the government collects 6.25% of nothing. Instead of the state coffers gaining the extra $106 million the politicians predicted, millionaires paid $100 million less in taxes than they did last year -- even at higher rates.

    No doubt the majority of that loss in millionaire filings results from the recession. However, this is one reason that depending on the rich to finance government is so ill-advised: Progressive tax rates create mountains of cash during good times that vanish during recessions. For evidence, consult California, New York and New Jersey (see here).

    The Maryland state revenue office says it's "way too early" to tell how many millionaires moved out of the state when the tax rates rose. But no one disputes that some rich filers did leave. It's easier than the redistributionists think. Christopher Summers, president of the Maryland Public Policy Institute, notes: "Marylanders with high incomes typically own second homes in tax friendlier states like Florida, Delaware, South Carolina and Virginia. So it's easy for them to change their residency."

    All of this means that the burden of paying for bloated government in Annapolis will fall on the middle class. Thanks to the futility of soaking the rich, these working families will now pay Mr. O'Malley's "fair share."
  2. You don't actually think they'll ever learn, do you? :cool:
  3. Who cares, millionaires should be fleeced.
    Let's hope they go to another country and leave the US! Only want the benefits of living in the US and not the disadvantages, then give up your US citizensship!!!
  4. If we all leave and there are no rich "to be fleeced", where will your job and government hand outs come from?

    What will you do then, $5 BJs for a living?
  5. Ahhh, the stupidity of youth.

    Let's see if you feel the same way if you ever get to be a millionaire.
  6. aegis


    Millionaires shouldn't be fleeced. Billionaires should. Unfortunately, it's the billionaires that make the rules.
  7. NOBODY should be fleeced. And no one deserves anything more than what they earn for themselves.
  8. aegis


    Blah, blah, blah. All that Ayn Rand bullshit sounds really good on paper.

    Too bad it doesn't work in practice. 95% of the billionaires in the world aren't worth one-twentieth of what they have.

    I'm sure you'll feel very different when these billionaire Fabian socialists have complete control over you and your money.
  9. i guess you missed this part: "No doubt the majority of that loss in millionaire filings results from the recession."
  10. Your statement is mere jibber. What point are you trying [so ineffectively] to make?
    #10     May 26, 2009