Well, what do you know? Barely a month after its enactment, New York State’s biggest income tax hike since 1961 has already driven away one of the Empire State’s wealthiest and most productive residents. Make that former resident, as the Rochester Democrat and Chronicle reported:
Rochester-area billionaire Tom Golisano said he’s had enough of New York’s high taxes and is changing his residency to Florida — where he figures he’ll save a stunning $13,800 each day in personal income taxes.
“I can put that money to a lot better use, whether it be charitable contributions or even to try to change the system,” the Paychex Inc. founder and three-time gubernatorial candidate told reporters after delivering a speech [last] Thursday at the Hyatt Regency.
Golisano, 67, owns a home in Naples, Fla., where he already spends three or four months a year, and said he had considered changing his residency for some time. But after the new state budget increased income taxes on the wealthy, “It was a very quick decision.”
Changing his residency to Florida, one of seven states with no personal income tax, will save him at least $5 million a year, he said. Forbes magazine last year listed Golisano’s wealth at $1.7 billion.
Proponents of the just-enacted income tax hike (actually, they pushed for an even larger increase) assured us this kind of thing simply wouldn’t happen. As Dan Cantor of the Working Families Party wrote last fall:
“Opponents of a tax on millionaires repeat the mantra that asking the wealthy to pay a modest increase in income taxes would drive them out of the state. But all the evidence and recent experience says that simply isn’t so.”
Then there was Iris Lav of the Center on Budget and Policy priorities, as quoted recently in The Capitol:
“Most people are not as tax-sensitive as we think they are .. There are a lot of reasons why people live where they live. They live there because their businesses are there, because they like it, because their families are there. State income taxes are pretty low on their list because it just doesn’t make that much difference to them.”
Go figure: Golisano was unwilling to sit still for an apparent $1.2 million increase in his already heavy New York tax bill. While he is far wealthier than most people affected by the tax hike, Golisano is typical of many filers in the new 8.97 percent top bracket (up 31 percent from the previous rate) in that he already has a second home in Florida — so it was all too easy for him to shift “domiciles” once he got fed up.
But Ms. Lav had a point: most people affected by a state tax hike, even a large one, do not react by immediately moving–if only because, for one reason or another, they can’t. Then again, it won’t take many movers to make a difference; for every 1,000 mere $1 million-a-year earners follow Golisano out of state, the income tax loss to New York will come to nearly $90 million. Many others will stay in New York but shelter more of their income, or shift more of it (quite legally) to sources beyond the reach of New York income taxes. Still others, while keeping at least a part-time home in New York, will decide to steer more of their business investments elsewhere, with an inevitable impact on employment in the state.
For some, perhaps many, the money involved in the tax hike will matter less in the long term than the decidedly business-unfriendly attitudes exhibited by the vocal class warriors who successfully pushed for the increase, and who now seem to increasingly dominate Albany politics. For example, as the Post reported:
Working Families Party Executive Director Dan Cantor, who championed the tax hike, called Golisano’s move “selfish.”
“It’s a disgrace that this is how he pays back the state where he was presumably educated and that’s been so good to him,” Cantor said. “Taxes are the price you pay for civilization. He’s moving to a space where there’s a little bit less civilization.”
In fact, while Golisano may have wasted millions on three quixotic gubernatorial campaigns, he is also one of those rare “selfish” people whose name frequently arises in close proximity to phrases like “largest donation ever” (try Googling it and see). His foundation has given away $100 million over the past decade. He is one of the most successful entrepreneurs in the history of upstate New York. Few–whatever their opinion of his political ventures–would deny that the region has benefited greatly from Tom Golisano’s presence.
Florida may never be “civilized” enough for some people, but it is now home to one more formerly New York-based fortune.
You may also like
"...the Empire Center is the think tank that spent months trying to pry Covid data out of Mr. Cuomo's government, which offered a series of unbelievable excuses for its refusal to disclose...five months after it (the Empire Center) sued, Team Cuomo finally started coughing up some of the records." -Wall Street Journal, February 19, 2021
SIGN UP TO READ ABOUT THE ISSUES IMPACTING NEW YORKERS.