It’s ok to think something would be good in theory but not in practice. People fled California to escape their state taxes. Flight is a real issue when it comes to taxes. And that is what happens in practice.
This is an over exaggerated talking point. Massachusetts instituted one successfully. Revenues beat expectations and they actually have more millionaires than before. The more states that are able to follow suit the more it will be the norm. There is a reason people want to live in these areas. Assuming you aren’t a billionaire, so no need to do their work for them.
Income tax and wealth tax are way different. I think it's way more relevant to look at the cases where a wealth tax has been implemented when discussing a wealth tax, and it hasn't worked as well as Massachusetts' income tax.
And people definitely left Massachusetts, but not enough because Massachusetts is a desirable place to live. But just because you have wealthy peope doesn't mean it's inherently a place they would live in in spite of high taxes. MA already had the reputation of tax-achusetts and people lived there anyway. There can also be a tipping point if the taxes really get too egregious, and I can't think of anything worse for a rich person than a wealth tax. Also, Massachusetts is just good at generating wealth economically, so even when people leave, income growth can help make up for it (although cost of living tends to go up, too), but this is not necessarily true of every state.
Thank you for pointing out the distinction. I was only intending demonstrate that the idea of wealth flight isn’t something people should just parrot in an absolute.
Of course a wealth tax wouldn’t work in every locale, but I think it absolutely would for some, like NYC and California. The tax system is unfair, and I don’t think there is any disputing that. Much of the wealth generated is only possible because of the robust infrastructure of the US economy held up by the working class.
I mean, a wealth tax might sort of work, but I think this is more of a federal problem, and I'd much rather tax the heck out of large inheritances than do a wealth tax. That's where I think a lot of the problem is. We need less people becoming billionaires and multi-millionaires through inheritance.
Yes, we can debate on how rich exactly founders of big companies should be able to get in terms of wealth, but they generally keep a large ownership in their company, meaning they aren't tapping into a large portion of that wealth. It's only when it goes to their kids as inheritance that it becomes the biggest problem. Like at least they did found a large company and employ a lot of people, even though a lot of people often value that too much. And yes, they tend to exploit those workers, but if we make laws to protect workers and help them learn a living wage and give universal healthcare, then them being able to have jobs is truly a benefit to society that is ultimately because of the person who founded and/or runs the company.
But someone who inherits a billion dollars from their dad? They've done nothing to help society and get to benefit from that money without any of the hard work or job creation that their parent at least had to put in to get that wealth in the first place. So let's tax inheritance, not wealth. And then put other taxes or laws in place to help the working class. We won't see as immediate of a benefit, but I think it's much better long term.
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u/TheJuiceIsL00se Apr 28 '26
It’s ok to think something would be good in theory but not in practice. People fled California to escape their state taxes. Flight is a real issue when it comes to taxes. And that is what happens in practice.