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Tuesday, November 13, 2012

The Highest State & Local Income Taxes on Millionaires

Forbes:  The Highest State and Local Income Taxes on a $1 Million Income -- Post Election 2012:

  1. New York, NY ($103,280 tax; 12.7% top rate)
  2. Honolulu, HI ($96,557; 11.0%)
  3. Los Angeles, CA ($96,189; 13.3%)
  4. Portland, OR ($91,609; 9.9%)
  5. Baltimore, MD ($83,188; 8.95%)
  6. Washington, D.C. ($82,902; 8.95%)
  7. Portland, ME ($78,860; 8.5%)
  8. Burlington, VT ($77,561; 8.95%)
  9. Minneapolis, MN ($74,874; 7.85%)
  10. Wilmington, DE ($74,310; 8.0%)

Interestingly, all ten cities are in states that voted for President Obama in 2008 and 2012.

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Comments

Theory - states with the highest Gini indices tend to have the highest income tax rates (re-distributionist impulses strongest where political class claims incomes are most disparate).

NY (Wall Street's 400,000 and everybody else) and CA (Hollywood and Silicon Valley's 600,000 and everybody else) seem to be the models for this.

Surely there must be an academic paper (more likely thousands) on this.

But having fed the political class on this narrow base (democracy only requires 51% to economically expropriate 49%, ultimately...how much easier is it to politically render 90% indifferent/hostile to 10%? Or 80% to 20%? Or 70% to 30%?) these states have seen their revenues become more volatile (tech bubble burst, housing bubble burst, accompanying Wall Street bubbles burst, etc.)

So the definition of "rich" must be politically defined ever downward, to capture more of the fast receding wealth of the state/nation.

That is how we end up with "millionaire's" taxes on people making $250,000.

Posted by: cas127 | Nov 13, 2012 2:48:52 PM