Posted on 05/26/2009 5:20:28 AM PDT by reaganaut1
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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.
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" [and can move there].
(Excerpt) Read more at online.wsj.com ...
Sorry, that barn door is already closed, because California pursued that policy with people who moved to Nevada.
A case was taken up to the SCOTUS in the 90’s, and the high-tax states lost.
Pennsylvania tried that with liquor a few years back. They had people noting license numbers of PA cars parking at NJ liquor stores just across the river from Philadelphia. The cars would then be pulled over at the bridge toll booth.
The uproar from NJ put a stop to it.
As long as they have their business in a partnership, LLC (or similar) or C-corp. S-corps face a limit on the amount of capital that can be accumulated without a definite purpose (eg, purchase of a piece of capital equipment or expenses). Otherwise, the tax laws require excess cash be passed through to the owners so it can be taxed, because S-corps are pass-through entities, unlike C-corps.
This is why it helps to think about these things before you form the company.
Ri-ight.
A lot of European celebs used to come to the US for lower taxes. The Beatles, Bjorn Borg, Martina Navratilova, etc. fled their countries for the tax haven called U.S.
Anybody who thinks the flow can't go somewhere else is fooling themselves.
>I’ve read that they have state cops cruising the mall parking lots (in unmarked cars) looking for MA plates.
Why do I imagine [MA people] shooting those guys because they were stalking them and they feared for their safety?
Who would’ve guessed.
Democrats don’t want to pay taxes.
>Sorry, that barn door is already closed, because California pursued that policy with people who moved to Nevada.
>
>A case was taken up to the SCOTUS in the 90’s, and the high-tax states lost.
That’s good news.
I am surprised they list South Carolina as a more tax friendly state when income tax begins at a three percent rate here on income from $2631. to $5260. annualy and peaks at seven percent on all above a measly $13151. annually. That is considerably higher than Maryland’s peak rate. It is quite common for workers in South Carolina to pay a hefty state income tax even when they may not owe any federal income tax. I consider the income tax in my state to be a disgrace and sales taxes have nearly tripled during my lifetime, it may not be the worst but it is no tax haven either.
We may control the disposition of certain assets (and relationships), but at the end of our tenure with such items, anyone with an overview of what happened to them will see with what mettle we lived our lives.
HF
I know from having prepared taxes here in Florida, many baseball players take quick advantage of Spring Training here to 'establish' permanent homes here and thus reduce tax bites except when they actually play in high tax localities. Lots of Yankees are permanent in the Tampa Bay area including Boss George.
Question:
Has anyone ever risked his life to gain entry into a socialist country that is headed toward complete leftist dominance?
“Stupid” and “Politicians” go together like butter and toast...
“Increases in Minimum wage have NEVER created a better employee.”
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I agree totally! People won’t decide to work harder because you pay them more. Some will work harder to advance in pay though. Somehow we have lost the concept of merit pay in this country. The last place I worked as an employee had a set pay scale for everyone. Some worked hard because it was their nature but the majority did as little as they thought they could get by with. I don’t think the minimum wage is our big problem, I think our big problem is that too few employers offer a clear path to advancement based on merit. Most of this probably has arisen because of government meddling in the relationship between employee and employer. What I am referring to also has nothing to do with unions, it is occurring in non union shops.
You won’t find goofoffs in any environment where pay is based SOLELY on production such as straight commission sales work. People either produce or leave because there is no pay for the unproductive.
The Baltimore of Chesterton and Mencken was a wonderful place. I grew up in Maryland just outside Washington. As a lad of ten I could walk (with a 410 or .22) unobstructed straight twenty miles from my home through woods and abandoned fields (Great Depression). No one thought a boy of ten or twelve with a rifle unusual, although my brother was once chastised by a priest for shooting squirrels in a graveyard. “A! Fredome is a noble thing!”
You'd think that all these Massachusetts tax evaders shopping in New Hampshire would have been smart enough to vote Yes on Question 1. Go figure.
Hahahahaha. In all seriousness, Atlas shrugs occurs much more easily in a small location.
We already have that globally in the 1996 federal ex-pat-tax.
bttt
Just as long as said millionaires leave their crappy voting patterns behind, as well.
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