Illinois Governor Pat Quinn is the latest Democrat to demand a tax increase, this week proposing to raise the state's top marginal individual income tax rate to 4% from 3%. He'd better hope this works out better than it has for Maryland.
We reported in May that after passing a millionaire surtax nearly one-third of Maryland's millionaires had gone missing, thus contributing to a decline in state revenues. The politicians in Annapolis had said they'd collect $106 million by raising its income tax rate on millionaire households to 6.25% from 4.75%. In cities like Baltimore and Bethesda, which apply add-on income taxes, the top tax rate with the surcharge now reaches as high as 9.3%—fifth highest in the nation. Liberals said this was based on incomplete data and that rich Marylanders hadn't fled the state.
Well, the state comptroller's office now has the final tax return data for 2008, the first year that the higher tax rates applied. The number of millionaire tax returns fell sharply to 5,529 from 7,898 in 2007, a 30% tumble. The taxes paid by rich filers fell by 22%, and instead of their payments increasing by $106 million, they fell by some $257 million.
Yes, a big part of that decline results from the recession that eroded incomes, especially from capital gains. But there is also little doubt that some rich people moved out or filed their taxes in other states with lower burdens. One-in-eight millionaires who filed a Maryland tax return in 2007 filed no return in 2008. Some died, but the others presumably changed their state of residence. (Hint to the class warfare crowd: A lot of rich people have two homes.)
Facts have never bothered Statists. This kind of evidence has been available for decades. They don't care. They will squeeze the golden goose until its dead. Then blame the death on someone or something else. Or claim the goose was dying anyway and we should thank them for trying to do something for the masses.
ReplyDeleteTaxpayers will go underground.
ReplyDeleteWhile we are fighting global government ideas. The rich move all over the globe because money talks and b**lshit tries to collect higher taxes from ...you guessed it!
ReplyDeleteLets all drink lots of coolaid and sing the Obamalamadingdong and you will have a nice day too.
When the tax increase of "3% to 4%" first appeared, it was listed as a "33%" tax increase. Thanks for using the, um, better percentage. LOL
ReplyDeleteMove to Missouri where we tax everything and 6% on your income.
ReplyDeleteThey can't hide forever.
ReplyDeleteMove to maine here we tax everything but welfare
ReplyDeleteyeah missouri really sucks, they really tax you to death. I miss Texas need to get outta Missouri.
ReplyDelete