hode Island just enacted a tax increase that will chase the highest-earning households out of the state and ensure revenue shortfalls as long as it remains in place.
These millionaire taxes are an increasingly popular idea that benefits low-tax states while punishing everyone who remains stuck in high-tax ones.
Gov. Dan McKee on Friday signed a state budget that raises the tax rate on annual income above $1 million to 8.99 percent, up from the current 5.99 percent. That is a 50 percent tax hike on the state’s most successful people.
McKee, a Democrat, is up for reelection this year and is in a tough primary battle against wealthy opponent Helena Foulkes. That explains his support for a monster tax increase he opposed last year.
I am by no means convinced that all these governors and state legislators really believe that these tax hikes will raise additional money. Some dimwitted true believers certainly do imagine that people are so enamored of their current places of residence that they will accept anything as the price of remaining there. New York City mayor Zohran Mamdani, Los Angeles political boss Karen Bass, and Seattle chief executive Katie Wilson are apparently among these.
At a news conference early this month, Wilson “laughed off warnings of a millionaire exodus even as a new survey shows many business leaders are considering leaving the state,” the New York Post reported. “I still think that claims of a large exodus of rich people due to our statewide millionaire tax that the legislature passed this year are overblown,” Wilson told FOX 13 Seattle with a laugh.
Just a few days later, the Downtown Seattle Association issued a report stating the “JumpStart” business taxes Seattle passed in 2020 have resulted in the loss of 30,000 jobs, a near-quintupling of the downtown office vacancy rate to 32 percent, and a 21 percent decline in the value of office properties. As a result, “the taxable value of its office buildings has fallen 48% — even as Bellevue [Washington], which has no comparable tax, added jobs and saw commercial values rise 7%,” Geekwire reported.
Hellbound and Down 