State Taxes Drive Away Star Athletes And Undermine Local Teams

Dan Mitchell, Greedy Politicians Drive Away Star Athletes and Undermine Local Teams:

The fundamental insight of supply-side economics is that people respond to incentives. So if the government imposes a high tax rate on income, people will try to avoid or evade the money grab.

Especially if they have any ability to control the timing, level, and composition of their income.

Star athletes are definitely in this group.

• Phil Mickelson
• Max Verstappen
• Usain Bolt
• LeBron James
• Bryce Harper
• Dwight Howard
• Shohei Ohtani
• Tyreek Hill

We can add Grant Williams to that list, as reported last year from Boston.

Why It Wasn’t ‘Realistic’ for the Celtics to Keep Grant Williams After Porzingis Trade
Testing the market worked out for Williams, who will now make more money while living in Texas, which does not have state income tax. Williams reportedly turned down a four-year, $48 million over offer from the Celtics last season. Williams mentioned Massachusetts’ Millionaire’s Tax as one of the factors he was mindful of when considering the Celtics’ offers. The Millionaire’s Tax is a four percent tax on top of Massachusetts’ five percent income tax, which raises the tax rate to nine percent for millionaires.“I was thankful just because I feel like the way my agent and everybody talked about it was that this was our floor,” Williams said. “In Boston, it’s really like $48 million with the millionaire’s tax, so $54 million in Dallas is really like $58 million in Boston and $63 million in L.A. “It was a little strategic on that end,” Williams continued.

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