Taxpayers are Leaving New York in Droves

It was reported recently by Americans for Tax Reform that taxpayers are overwhelmingly leaving Democrat-controlled states and moving to Republican-controlled states. New York was the biggest loser when it came to its taxpaying population.

Liberals like high taxes, because they think that will bring in the most tax revenue to fund their ever-growing government and pet projects. What they don’t consider is that the higher the taxes, the more people want to move away to another state that doesn’t tax as much. As a result, the state ends up losing money (not necessarily a net loss of revenue, but anytime a taxpayer leaves a state, he takes with himself tax revenue). And those states with lower taxes take in more taxpayers and in turn, more revenue.

In New York in 2013, according to IRS data, nearly 115,000 people left New York. That translated into a loss of about $5.7 billion in revenue for the state. Americans for Tax Reform reported:

Newly released IRS migration data from 2013 shows that New York lost more taxpayers than any other state in the nation. That year, nearly 115,000 residents left the Empire State, taking with them $5.65 billion in adjusted gross income (AGI) to spend elsewhere.

This new data shows that New York will remain America’s “Biggest Loser,” having lost nearly 1.6 million taxpayers between 1985 and 2013. Those residents took with them more than $80.8 billion in annual AGI.

The phenomenal failure of New York to retain taxpayers and businesses is directly related to its uncompetitive tax and business climates. By some measures, New Yorkers face the greatest tax burden of any state in the nation. The personal income tax system consists of eight brackets and a top rate of 8.82%. The corporate tax of 7.1% and property tax collections are $2435 per person. The Tax Foundation ranked New York 50th until this year after a set of minor tax reductions.

When Governor Cuomo was asked for his reaction to this news, he stated that it “wasn’t fair because it didn’t include migration into the state... Looking at one-half of the equation is not how you do math.”

The thing is, the data indeed includes migration into the state. According to IRS data and based on address changes on tax returns, there was an inflow (migration in to the state) represented by 167,337 returns filed with a total of 247,466 exemptions – the total number of individuals claimed as dependents on the returns. The outflow (migration out of the state) was represented by 219,652 returns filed with a total of 386,395 exemptions. The difference between the two exemption totals is 114,929. That is a net loss. Here’s the IRS data.