A major trend in the next five-ten years will be baby boomers deciding where to live when it is time to retire (and they don’t need to commute any more).
One factor they will look at is _future_ local and state tax rates.
The only elderly left living in Illinois in ten years could be Medicaid recipients—and think about what that will do for local and state revenues vs spending.
Illinois does not have a lot of time left to fix this.
“A major trend in the next five-ten years will be baby boomers deciding where to live when it is time to retire (and they don’t need to commute any more). One factor they will look at is _future_ local and state tax rates.”
That’s the tip of the iceberg. Add “national” taxes to the mix of things looked at, and you see the problem that’s brewing. U.S. dual nationals living abroad are already renouncing their citizenship to avoid the taxes and banking problems they’re encountering. As those tax issues become more relevant to those at lower and lower income levels, as they will, you see the potential problem.
One smart thing that Gov. Romney is pushing is to stop taxing Americans on a citizenship basis rather than a residency basis as most countries already do. It’s not to be nice to expats, simply an acknowledgement of reality.