Flight of the Millionaires?: Experiments in Taxing High Incomes in New Jersey and California
Oct 22, 2012
from 12:00 PM to 01:30 PM
|Where||1130 K Street, Room LL3|
|Contact Name||Hilary Wilkoff|
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As federal tax rates on high incomes have declined, several states have added “millionaire taxes” as new sources of revenue. Concerns have been raised about states’ ability to sustain these policies without losing top earners, who might choose to reside in lower-tax jurisdictions. Although existing research finds that people rarely migrate for tax purposes, the rich may be different. Using state tax returns, we analyze two recent income tax increases – New Jersey’s 2004 tax on income above $500,000 and California’s 2005 tax on income above $1,000,000. Neither change appears to have influenced the migration patterns of the rich. This suggests that high income earners are similarly unresponsive to modest changes in their marginal tax rates.
Charles Varner is a doctoral candidate in sociology at Princeton University. His dissertation examines migration and political responsiveness to state fiscal policy.
Cristobal Young is an assistant professor of sociology at Stanford University. In addition to his interests in taxation and migration, he has published work on labor markets, and statistical methodology.
This event is co-sponsored by the California Research Bureau.