Plague of Taxes Sparks New York Exodus

Plague of Taxes Sparks New York Exodus

How the mighty fell. The latest Census Bureau data shows the Empire State’s population exodus continues as people flee New York in droves.

From July 2021 to July 2022, 300,000 more people moved overseas than moved in. New York had the largest population loss—both in percentage and absolute terms—experienced by any state during that period.

Sadly, this was both predictable and preventable.

In March 2021, a study of New York found that its already extremely high tax burden had worsened due to an increase in the top marginal tax rate to almost 15% for those in New York City. The study predicted that the flood of people leaving alone would accelerate — and it did.

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Even before that study, the Empire State lost so many people that it cost New York a seat in Congress after the 2020 Census. This exodus is a direct response to New York’s high taxes.

How bad is it? Compared to other states, New Yorkers:

Pay the highest total tax burden and the highest percentage of personal income (14%) in taxes. Endure the second-worst overall business tax climate. Face the higher individual income tax rate and per capita income tax collection. Pay the second highest per capita state and local corporate income tax collections. It has the highest property taxes and local sales taxes (on average), pays the highest cigarette taxes, and the ninth highest gasoline taxes. Pay the sixth highest rate of capital gains tax. They are tied for the third highest property tax rate.

And what do New Yorkers get for all these taxes? Roads as smooth as glass? The best airports in the world? Do the trains run on time? Bulletproof power grid and water infrastructure? Ample police to maintain safety and order?

Not even close.

Instead, New York City residents face some of the highest crime rates in the world, thanks to soft-on-crime policies by liberal politicians. And people everywhere across the state are threatened by a looming municipal debt crisis. Regardless of its tax policies, New York has accumulated the highest state and local debt per capita in the country.

And the future is not bright. When people leave the country, they take their jobs and money with them. This prevents future revenue collection for a state that has never learned to spend within its means. But the days of bailouts from tycoons like JP Morgan are long gone. Absent a federal bailout, both New York State and New York City are on a collision course with first-grade math — and bankruptcy.

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Sadly, many New York politicians seem to have learned nothing from their repeated failures and are instead pursuing more of the same, reminiscent of the famous maxim about insanity. The Empire State’s gasoline tax just went up 16 cents per gallon on Jan. 1 — a fitting way for the nation’s highest-taxed state to ring in the new year.

New York’s New Year’s resolution should be to ditch this fiscal folly and follow the fiscal lead of Florida, a state experiencing a population boom. While those hundreds of thousands of New Yorkers were fleeing for greener pastures, the exact opposite happened in the Sunshine State. Florida welcomed 318,000 more people than remained during that time period.

What is the attraction? While top earners in New York City pay almost 15% income tax to their state, Floridians pay nothing to their state. In fact, whether it’s income, sales or property taxes, Florida beats New York by a mile. Comparing the state and local tax burdens of the two states, an average earner saves about $5,500 a year by moving to Florida. High earners save significantly more.

After 130 years of waiting in silence for countless people in New York, one can imagine an Olympic-sized tear rolling down the face of the Statue of Liberty as it helplessly watches its descendants depart for far more tax-friendly regions of the country.

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