> NYC high earners are going to be knocking on the door of 60% combined rates (city, state, federal). tax avoidance and/or relocation services are going to be booming if so.
It turns out that people don't often move over taxes, despite the claims of the anti-tax crowd, or NY and CA would have been emptied out long ago. Taxes are investment; we need to start calling them 'low-investment' and 'high-investment' states (but the liberal crowd is blind to the power of messaging and perception). People like the services and the community that investment creates, such a health care and arts.
Also, they can subtract their health insurance costs, and you are only talking about income taxes, while most taxes are either fixed rate for benefits (e.g., Social Security) or, for the wealthy, capital gains.
This is anecdotal, but I know multiple people who have moved to Washington and Texas from NY and CA specifically to save on taxes from large stock grants at tech companies. I don’t think this is a unique experience in the tech industry. At a large public company I worked for, an entire team ended up moving.
I don't know those people and of course can't judge anyone else but me. Generally, the trendy focus on taxes is absurdity. They are making all that money, and are uprooting their lives and family, not to mention the other benefits of living in world cultural and technology capital (which isn't coincidental to the taxes and resulting community investment), to save on taxes? I hope they see that some things are more important in life.
Seattle and Austin are totally comparable, even preferable, to NYC and SF in many ways. So yes, all else equal, why not save an extra 10% of your income?
> Seattle and Austin are totally comparable, even preferable, to NYC and SF in many ways.
I'm sure we can find ways, Seattle and Austin are wonderful places, and what makes NYC and SF special doesn't appeal to everyone. But really Seattle and Austin are not even close. There's a reason NYC and SF have been centers of culture and business for generations; there's a reason that demand is so high that housing costs are stratospheric.
Sure NYC has certain desirable aspects. Seattle has a different set (e.g. way better nature). The point isn’t to compare the cities to find the absolute best. Rather, the question is whether or not the benefits of certain cities or worth the cost. For high earners, the cost of living in NYC is hundreds of thousands or even millions of dollars per year. For some percentage of people that cost is simply not worth it and they move. To claim people don’t move because of taxes is to deny basic economics.
> To claim people don’t move because of taxes is to deny basic economics.
No, it's just not framing the entire economic question around taxes. There are many, many other factors. You can live in places with no taxes at all, but people don't choose to.
> the cost of living in NYC is hundreds of thousands or even millions of dollars per year. For some percentage of people that cost is simply not worth it and they move
They've already moved in that case, but the demand for NYC is enormous.
Maybe we're discussing different things. I was responding to the claim that higher taxes doesn't cause people to move. Just because high earners live in NYC doesn't mean that there weren't some high earners that left due to taxes.
It turns out that people don't often move over taxes, despite the claims of the anti-tax crowd, or NY and CA would have been emptied out long ago. Taxes are investment; we need to start calling them 'low-investment' and 'high-investment' states (but the liberal crowd is blind to the power of messaging and perception). People like the services and the community that investment creates, such a health care and arts.
Also, they can subtract their health insurance costs, and you are only talking about income taxes, while most taxes are either fixed rate for benefits (e.g., Social Security) or, for the wealthy, capital gains.