Embroiled in the California debate over Proposition 30's progressive income tax proposals, some politicians have argued that raising taxes on the highest earners will drive them to states with lower tax rates, taking businesses and jobs with them. But a study released by the Stanford Center on Poverty and Inequality concludes that "millionaire migration" is simply a myth. Stanford's Cristobal Young, an assistant professor of sociology, and Princeton's Charles Varner, a doctoral candidate in sociology, conducted the study at the request of the California Board of Equalization, allowing them unique access to California Franchise Tax Board income data. The mountain of data included information from all state income tax records for California from 1992 to 2009. The result of all that data crunching? The migration of millionaires in and out of the state has almost no relationship to tax increases or tax cuts. Young said that having access to such comprehensive data allowed him and Varner to contribute compelling evidence to the income tax debate. "I think it's important that we can bring really high quality data to these kinds of issues," Young said. The immense dataset, though a goldmine, also represented a challenge for the researchers, who pored over more than 300 million data points. "It was an entirely different technical world," said Young. "You have to be extremely careful with this kind of data. Everything gets triple checked and code reviewed." The findings are consistent with the results of a study the team led in New Jersey last year. The reason the number of California millionaires varies from year to year has almost nothing to do with taxes, the researchers found. Instead, the numbers change as incomes fluctuate, most likely because investments are sensitive to market cycles. Varner and Young looked at millionaire migration after California's 2005 Mental Health Services Tax was enacted, as well as after state tax cuts in 1996. They found that millionaires did not flee as a result of the tax increase (in fact, more millionaires moved into the state than out during that period), nor did millionaires from elsewhere move to California as a result of the tax cuts. http://news.stanford.edu/news/2012/november/millionaire-migration-myth-110212.html
bloomberg believes millionaires will stay put if services are maintained. Trash p/u, parks open/ police fire and safety. Cut these and they'll leave.
Yeah Millionaires will migrate en masse to live in Wyoming in the middle of the desert to save on taxes. California has the highest taxes but why is it that all the high tech companies seem to come from california?
study not handled correctly. Its about income and the type of taxes, not net worth. I could be a retired millionaire raking $75K a year, I will not be affected much unless they go after property taxes on my house. The real question is will companies move out or not, and if you really want to pinch individuals then start a wealth tax.
This article better describes California's economic problems. http://www.newgeography.com/content...phic,+and+political+commentary+about+places%2 California is no longer an incubator of high-wage jobs. The state lost 370,000 jobs paying 25 percent or more of the average wage between 2000 and 2008. This compares to a 770,000 increase in the previous 8 years. California is trailing Texas badly and the nation overall in creating criticial STEM (science, technology, engineering, mathematics) jobs and middle skills jobs. ======================= A few millionaires leaving is not the issue. The big problem is that low-paying jobs are replacing high-paying jobs that are leaving the state and transferring future wealth out of California. California per-capita GDP used to be 8th in the country, now it's 12th. California is on a steady economic slide downward.
My neighbor was an accountant at Petco here in San Diego, but Petco recently moved their office to Texas. A lot of companies have done the same. That kind of move won't show up on a study on the tax returns of millionaires.