The Hearst Connecticut Media Editorial Board recently published an editorial Parroting refuted Republican talking points of a supposed âmillionaire migrationâ if lawmakers dare to demand that Connecticut’s top earners pay their fair share. Republicans have resorted to sound bites because they can’t come up with alternatives, or an actual budget, which they haven’t come up with for three consecutive years.
Instead, Republicans hope to convince us of this boogeyman story of all state tax revenue catching the next private jet to Florida. But here are the facts: Reports say millionaires don’t move often.
According to a 2016 study conducted by the American Sociological Review, âmillionaires are not very mobile and in fact have lower migration rates than the general population. Part of the reason is that family responsibilities and business ownership are higher among the highest incomes, prompting individuals to live in their local areas. “
The report continued: âYet, given that migration flows represent a very small share of the highest incomes, the observed migration patterns have little impact on the tax base of the millionaire population, even over 13 years. “
Additionally, in 2017, the Internal Revenue Service confirmed data reported by the State Department of Revenue that low-income residents migrate from Connecticut at higher rates than high-income residents. The data clearly shows that millionaires are not fleeing the state at alarming rates because of tax policy, and that in fact millionaires continue to proliferate in Connecticut despite changes in tax policy.
Internal Revenue Service filings show that the number of Connecticut millionaires has grown over the years, even after the creation of five new higher tax brackets on highest incomes over the past 18 years.
It is also important to note that when former Governor Dannel Malloy took office and instituted higher income taxes for millionaires, the number of their declarations increased from 7,450 in 2008 to nearly 11,000 in 2012 – A 45% increase in Connecticut millionaires in just four years, all paying a higher tax rate.
Regarding the former governor, Malloy’s words were presented in an inappropriate context by this editorial board. When he said: âIf you blithely throw away the idea that you are proposing a 19.5% tax on an industry responsible for a disproportionate share of state tax revenues on personal income, then don’t be surprised when people start to explore other opportunities. “
He was not presenting a general warning against taxing the rich, he was specifically talking about a proposal to add a surtax on income derived solely from hedge funds. The listing was not tied to salary, the value of stock options, or stock market earnings.
The Hearst Connecticut Media Editorial states, âThe best people in Connecticut have a lot of money. And raising their taxes could temporarily bring the state even more wealth than it has reaped in federal aid and Wall Street deals this year.
The clever use of the word “temporarily” is an inaccurate representation of what asking the highest incomes to pay a little more would do for the state in the long run: establish stable and reliable revenue streams for years to come that will help. to fund the programs and services that Connecticut residents need and deserve.
What is âtemporaryâ are the federal government relief funds. These funds should not become a means of continuing to evade our collective responsibility to pay our fair share of taxes. In fact, the result of income and expenditure policy making based on the millionaire migration myth continues to place the tax burden on middle and low income Connecticut residents. These taxes and charges would be reduced considerably, and the likelihood of tax relief would be in order if this responsibility were distributed equitably.
While it may be difficult for some to resist the temptation to fear the boogeyman, the myth of millionaire migration is just an excuse not to raise taxes on top earners. Connecticut’s middle class and poor lack the financial capacity to keep footing the tab, and they have no interest in allaying the refuted and inaccurate fears of those who align themselves on the wrong side of this debate.
Jennifer Pope of Hamden is a woman of the 11th District Democratic State Central Committee of the Senate.
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