Normally I would not be able to tie the article in today's Wall Street Journal to B'game except I spoke to a local friend this week who was considering moving out of state after the recent passage of Prop. 30. The Journal article is titled "Moving Sale: A Chateau on the Cheap?" and relays how upper income French folk are selling their high-end real estate (sometimes multiple properties) and leaving the country.
The number of high-end homes on the market has increased, with sales due to expatriations skyrocketing this year to several a week from a few a month, says Charles-Marie Jottras, president of leading luxury brokerage Daniel Féau. Fiscal expats account for more than half of the homes Daniel Féau lists between $6.4 million and $19.2 million, compared with about 10% in prior years.
And it goes on to note
Of course, the French have been moving abroad for decades to escape the country's punishing taxes. But the profile of those leaving is changing. In the past, the typical fiscal expat was a golf-playing retired Frenchman, who packed up after the kids left home and 40 years of paying French taxes, brokers say.
Today, the new expats are younger and still earning their fortunes, a reflection of the government's shift toward targeting high salaries instead of household wealth, as well as the greater ease of moving across Europe's open borders.
So, who knows? The California "barbell economy" and long-term trend of people leaving for OR, AZ and CO could impact our state economy in a similar way as we move to the highest state income tax rate in the country.
It amazes me that 3/4 of Burlingamers voted to increase state taxes and are very vocal about needing to increase federal taxes so the "rich" pay their fair share. Then they come around and ask for money for local propositions and BCE. Guys, my money is going to Washington and Sacramento. None left for BCE. Feds and state are taking thousands more. That will help our schools.
Posted by: Greg | November 23, 2012 at 10:25 PM
It seems the Brits react much like the French--who would have thought so? From the UK newspaper Telegraph:
In the 2009-10 tax year, more than 16,000 people declared an annual income of more than £1 million to HM Revenue and Customs.
This number fell to just 6,000 after Gordon Brown introduced the new 50p top rate of income tax shortly before the last general election.
The figures have been seized upon by the Conservatives to claim that increasing the highest rate of tax actually led to a loss in revenues for the Government.
It is believed that rich Britons moved abroad or took steps to avoid paying the new levy by reducing their taxable incomes.
George Osborne, the Chancellor, announced in the Budget earlier this year that the 50p top rate will be reduced to 45p from next April.
Since the announcement, the number of people declaring annual incomes of more than £1 million has risen to 10,000.
However, the number of million-pound earners is still far below the level recorded even at the height of the recession and financial crisis.
Last night, Harriet Baldwin, the Conservative MP who uncovered the latest figures, said: “Labour’s ideological tax hike led to a tax cull of millionaires.
The rest of it is here: http://www.telegraph.co.uk/news/politics/9707029/Two-thirds-of-millionaires-left-Britain-to-avoid-50p-tax-rate.html
Posted by: Joe | November 28, 2012 at 08:59 AM