I have an idea - Let's scare off the last rich people we have here (New York: middle-class, mortgage)

[Canerican]

Originally Posted by ckhthankgod

While the burden might not be as high, what about the quality you get from that smaller burden?

I've always said, if you want the nanny state, come to NY. The government will pick up the tab for just about everything, as long as you aren't what they call "rich."

However, if you feel that you are better able to spend your hard-earned money than the government, you would not like WNY.

[UpstaterInBklyn]

You really can't discuss state-wide tax policies outside of the context of the NYC metro area.

The OP espouses a theory that we are "scaring off the last few rich people here". I can say that there are PLENTY of rich people in NYS. Not many of them live Upstate, however.

The fact is that NYC is a high-tax, very expensive place to live and do business, but these circumstances actually do not have a huge bearing on the relative success or failure of the economy here, or the number of high-income and wealthy people who choose to live here. I have often posited on this forum that NYC is successful because it does not need to compete on price, due to its position as a "world city" and as a hub of finance, media, culture and arts. Also, you have native-born residents with multi-generational roots and emotional attachment and pride in their hometown plus hundreds of thousands of domestic migrants and immigrants that are attracted here every year.

So, in a sense, people will "pay for the privilege" of living in NY.

That being said, I'm not in favor of higher taxes. I'm just making the point that the hypothesis of this thread "scaring off the last rich people we have" is flawed. There are many, many rich people in NYS who aren't going anywhere.

Note that this is also the case in other high-tax "Blue State" places as well such as Boston, San Francisco and LA. Generally, places in the US with a high level of cultural opportunities tend to attract and keep rich people despite the higher cost of living and higher taxes.

I'm not going to get into any "Blue State/Red State" arguments or the relative merits of living in a low-tax place like Texas vs. NYC. To each his own. I'm just stating some economic facts.

[12buttons]

Originally Posted by Canerican

DEM HEALTH RX A POI$ON PILL IN NY - New York Post

This is more a statement of the idiots that we have sent to Washington and to Albany, but if you were rich, would you honestly pay 57% of your wages in order to have the "privilege" of living here? I would guess that most would pull a Tom Golasano, and move to a lower tax state.

I did. Could not take the tax gig any longer...or should I say gagged?

[Canerican]

Originally Posted by 12buttons

I did. Could not take the tax gig any longer...or should I say gagged?

Good for you. Eventually they will have to realize that higher taxes make people move away, thus forcing them to raise taxes even more to pay for the taxes lost if the person never had move.

I'm on my way out too!

[HowardRoarke]

The whole rich people paying taxes thing has been done to death. First off, rich people paying the ridiculous taxes in NY might groan about it, but their resources and whatnot is their cushion, plus they have creative ways of hiding income and/or sending cash overseas (which is one of the reasons why our system of taxation is screwed up, and I can't blame a lot of rich folks for doing so), especially as tax rates go up (like they are right now). Contrast this with lots of working people, who in some ways are getting crushed by the taxes, fees, high utilities costs, etc., in NY. Golisano might enjoy saving his $5M or whatever he's gonna save per year, but was that the REAL reason he did this, was he just trying to make a point, etc.?

The rich like .17% in NY were paying like 40% of the income taxes, up until recently. Think 5th Avenue types, Golisano, etc.

Here's the deal-with all that there is that's GOOD about Upstate NY (and the rest of the state, for that matter), one would think there would be more investment, start-ups, etc., and that by now there would be more billionaires (but that's for another thread). Golisano is the only one I'm aware of who has lived in Upstate within the last several years. Not 100% sure there's a message in there, but, food for thought.

Rich people like to be around rich people, which is why Canandaigua L.'s West Lake Rd. is up there with Tahoe, NV, these days for per-capita income. Rich people really don't care, mostly, they'll figure out ways to live it up no matter where they live.

If top tax rates keep going up at the federal level, in Upstate, and NYC, not only would it force more folks to think about living in Upstate, your uber rich in NYC could suddenly make the decision to move overseas or to a different state or whatever. NYC is in bind right now 'cause the bottom fell out of city tax revenues, not only because of the obvious we all know about their situation and the economy across the U.S., but also because many millionaires have left the city in the last 12 months or so.

So, I guess the PO has a point about scaring rich folks out of NY state, but I think it's mostly in and around NYC, at the moment, since the city income tax went up a whopping 35% in the last 6 mos. and they're still in trouble.

I wouldn't be too concerned about rich folks leaving, it's the rest whom have already left and ain't comin' back, plus those who plan on leaving I'd be concerned about. With declining school enrollments (which means less aid), less local and state tax revenue, etc., NY will have no choice but to keep raising taxes and putting their hands out to the federal government.



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[UpstaterInBklyn]

I need to correct a couple of facts in your post

Originally Posted by HowardRoarke

NYC is in bind right now 'cause the bottom fell out of city tax revenues, not only because of the obvious we all know about their situation and the economy across the U.S., but also because many millionaires have left the city in the last 12 months or so.

Actually, NYC's recent budget gaps are due in a large part to drastically lower Wall St. incomes, not due to out-migration. The city takes in a lot of income tax revenue from multi-million dollar bonuses, which in '08 were way down from '07 (bonuses are generally paid at the end of the year).

Originally Posted by HowardRoarke

So, I guess the PO has a point about scaring rich folks out of NY state, but I think it's mostly in and around NYC, at the moment, since the city income tax went up a whopping 35% in the last 6 mos. and they're still in trouble.

CITY income tax did not go up at all. The top rate is still 3.65%. STATE income tax did. Basically the state created two new brackets at $200K (7.85%) and $500K (8.97%). Previously everyone earning more than $40K paid the top rate of 6.85%.

One more thing... it is always critical in these types of discussions to draw a distinction between wealthy people (those with a high net worth) and high income people. Our tax system taxes income, not wealth. A person with $10 million or, for that matter, $10 billion in assets pays no taxes on the value of those assets, only the income derived from them.

It cannot be assumed that all high net worth people are extremely high earners, nor that high income people always have a high net worth. A lot of truly wealthy people often do not get very concerned with taxes because they actually do quite well at minimizing their incomes while increasing their wealth. The "Old Money" Park Avenue/Upper East Side types have a lot of inherited wealth on which they pay zero taxes, because it is not income.

[Canerican]

Old Money is quickly going away, with our government's policy of taking half of all assets given to future generations, if they feel that the amount given is too much for their liking.

And true about wealthy people, perhaps NY would be a good place for some rich to retire, as sales tax is regressive, and the only other tax that they would have to pay is on their residence.

But if you plan on making money in New York... it's another story. Why do you think so many top executives moved their company's headquarters to Charlotte? To take advantage of the taxes there. And you think that the top brass would truly be opposed to have less of their personal income confiscated by the nanny state? Of course not! That is why Charlotte is booming and NY suffering from a dearth of high-earners.

[UpstaterInBklyn]

Charlotte isn't much of a boom town anymore:

• Unemployment rate is 12.5% (25% higher than NYS)
• Business investment is down by 66% compared to last year
• Office vacancy rate is up 22% since January
• Big foreclosure crisis in residential and commercial real estate
• Wachovia failed and was gobbled up by Wells Fargo

Ironically, things would be much worse in Charlotte had it not been for the government bailout of Bank of America. Charlotte has probably benefited from the surge in government spending more than almost anywhere else in the country because the government saved its biggest employer.

Back to my original point... personal taxation rates statistically have very little correlation to the concentration of wealthy and high-earners, who live in places that provide the lifestyle they want and/or allow them to earn a high income in the first place (for example, Wall St.). The proof is in the fact that so many of these choose people live in high-tax locations (NYC, Boston, SF, LA) because they would rather pay the price to have big-city culture rather than living in low-cost, boring places like Charlotte or Houston.

BTW - total agreement regarding the estate tax.

[Canerican]

Originally Posted by UpstaterInBklyn

Charlotte isn't much of a boom town anymore:

• Unemployment rate is 12.5% (25% higher than NYS)
• Business investment is down by 66% compared to last year
• Office vacancy rate is up 22% since January
• Big foreclosure crisis in residential and commercial real estate
• Wachovia failed and was gobbled up by Wells Fargo

You have to remember that Charlotte is still alot of industry, the same jobs being lost in Mobile, are being lost in Charlotte. The office vacancy isn't unique in Charlotte, I won't be bothered to look it up, but I have read a few times now that office space in the financial district is opening up like never before. Also, Charlotte had a lot of new buildings that were being built with tenants, a few went under, a few never got going...

I'm not saying that Charlotte is even a place I would love (though I would take it over NYC, I don't like big cities that much), it is undeniable that alot of CEOs are choosing it over NYC, just because the CEO will keep more money in his pocket.

[ckhthankgod]

Originally Posted by Canerican

You have to remember that Charlotte is still alot of industry, the same jobs being lost in Mobile, are being lost in Charlotte. The office vacancy isn't unique in Charlotte, I won't be bothered to look it up, but I have read a few times now that office space in the financial district is opening up like never before. Also, Charlotte had a lot of new buildings that were being built with tenants, a few went under, a few never got going...

I'm not saying that Charlotte is even a place I would love (though I would take it over NYC, I don't like big cities that much), it is undeniable that alot of CEOs are choosing it over NYC, just because the CEO will keep more money in his pocket.

Sure, the CEO can keep more money, but what about the workers under him or her?

Also, with the higher unemployment rate, how are these people being compensated when there isn't much in terms of taxes going towards such things like unemployment insurance?

Then, you have to remember that you still get taxes in Southern states, but it is done in different ways. You can be taxed on vehicles or even other possessions in a way it almost evens out.

With more people moving that way, it will in turn change the tax issue into one that is similar to what people up here have been complaining about, if it isn't occurring already.