When The Millionaires Are Gone, The State Will Do More To Empty Your Pockets
It’s entirely possible Democrats in the state Legislature have forgotten a very important lesson about millionaires — they didn’t get that way by throwing their money down the drain.
Democrats’ continued efforts in their nonbinding one-house budgets to increase tax rates on the state’s highest earners in order to pay for new spending come with diminishing returns over time. As Assemblyman Andy Goodell, R-Jamestown, pointed out recently, the high earners who pay the taxes that balance the state budget are leaving the state in droves. Wall Street may be in New York City, but big business can be run anywhere these days.
Data published by the Empire Center for Public Policy showed the number of New Yorkers with adjusted gross annual income of more than $1 million dropped to 54,370 in 2020 from 55,100 one year earlier, for a decline of 1.3%. In that same year, the year in which the pandemic first reached New York and other states, the number of millionaire earners nationally increased from 554,340 to 608,540 — a gain of nearly 10%, the researcher noted. So-called high earners comprise roughly eight-tenths of the state’s population but pay 48.5% of personal income taxes.
“That ought to be a shocking wake-up call for all of us,” Goodell said. “So we know that the millionaires are the highest percentage of people leaving New York state. Our own data shows that.”
Both the Senate and Assembly propose increasing the tax rate for those earning more than $5 million from 10.3% to 10.8% while also increasing taxes on those earning more than $25 million from 10.9% to 11.4%. Both of those increases would last through 2027.
Many of us wish we were in such a position to complain about this particular tax increase, But if the state keeps pickpocketing the rich and the rich keep leaving, guess whose pockets the state will come to next? Ours or the business that pay us. And neither of those pockets are as deep as they used to be.