http://www.nytimes.com/2013/10/26/business/taxing-new-yorkers-but-not-the-ultrarich.html?_r=0
To address the inequities of the two cities, Mr. de Blasio has proposed raising taxes on the wealthy, whom he defines as those making more than $500,000, to pay for prekindergarten and after-school care. This may be a laudable goal, but people making $500,000 who are actually living and working in the city already pay high federal, state and local income taxes as well as property taxes.
Tax law in New York City is determined by New York State, not the city, so the mayor has only the power of persuasion. But the mayor can be a strong advocate. A tacit goal of the Bloomberg administration seems to have been to woo the world’s superrich with generous tax treatment, in what seems to be a continuing global competition with London, Hong Kong and Singapore. Attracting the superrich may well bolster some tax revenue and confer benefits on the city and its more ordinary residents, but the question remains, can and should they be asked to pay more?
Nonresidents are an enormous potential source of tax revenue. According to the New York State Department of Taxation and Finance, in 2010, the most recent year available, there were 820,000 nonresident tax returns reporting $273 billion in income from all sources. Nonresidents appear to be disproportionately affluent. The idea that nonresidents should pay little or no tax has long rested both on notions of fairness, since they’re not around much to use city services, and pragmatism, because of the fear that higher taxes will drive them away.
Thoughts on a) Attracting the super rich and taxing them high like NYC and b) taxation on non residents?
To address the inequities of the two cities, Mr. de Blasio has proposed raising taxes on the wealthy, whom he defines as those making more than $500,000, to pay for prekindergarten and after-school care. This may be a laudable goal, but people making $500,000 who are actually living and working in the city already pay high federal, state and local income taxes as well as property taxes.
Tax law in New York City is determined by New York State, not the city, so the mayor has only the power of persuasion. But the mayor can be a strong advocate. A tacit goal of the Bloomberg administration seems to have been to woo the world’s superrich with generous tax treatment, in what seems to be a continuing global competition with London, Hong Kong and Singapore. Attracting the superrich may well bolster some tax revenue and confer benefits on the city and its more ordinary residents, but the question remains, can and should they be asked to pay more?
Nonresidents are an enormous potential source of tax revenue. According to the New York State Department of Taxation and Finance, in 2010, the most recent year available, there were 820,000 nonresident tax returns reporting $273 billion in income from all sources. Nonresidents appear to be disproportionately affluent. The idea that nonresidents should pay little or no tax has long rested both on notions of fairness, since they’re not around much to use city services, and pragmatism, because of the fear that higher taxes will drive them away.
Thoughts on a) Attracting the super rich and taxing them high like NYC and b) taxation on non residents?
The half-year rule also seems very arbitrary and I think it's crazy that someone avoided paying $26.7 million in NYC income tax. This rule just allows people to game the system. Like the article says, the property tax could have a more progressive rate which could get at the issue of the superrich nonresidents and I think that would be a good approach.
ReplyDeleteI agree with Devin. Especially considering that the "super-rich" can likely game the system in every city they ("don't") call home. I.e. if you make that much money you can likely split your time pretty effectively between 2 or more cities that have high tax rates, and claim residency in a low tax-rate haven.
ReplyDeleteThat makes sense.
ReplyDeleteJust doesn't seem like a sure fix. I don't blame them though, if I had that amount of money and could figure out how to pay less taxes I'd do it too.
ReplyDeleteI agree 110%.. if i was in there position I would definitely try to pay the least amount especially if it is not too difficult. I really do feel as if the rich should take on some of the taxes though with that being said. They have enough money as it is.
DeleteLet's stop focusing so much on taxing only the rich for once. Our reading was talking about how if we wanted to fix the deficit by just taxing the top 2 brackets more it would come out to like... 91% for the highest earners.
ReplyDeleteI agree. Non residents can easily manipulate the system to avoid taxes.It is appalling that the tax burden falls on the middle class again. One of the comments in the article suggests taxing all those who claim to be non-residents on a scale based on their time residing in New York instead of the 183 day rule. I think this would be a great way to raise tax revenue and avoid the super rich from gaming the system.
ReplyDelete