I understand Limbaugh’s situation is an individual case, but when you target high-wage earners with putative income taxes, those high-wage earners have the ability to work somewhere else. And sometimes they do.
Limbaugh took advantage of that opportunity years ago by moving to Florida and broadcasting from the sunshine state where there is no state income tax. Yesterday, he announced that he’s going to cut all business ties with New York State and New York City and no longer broadcast from the EIB offices there.
I’m leaving. I am seriously… See, ladies and gentlemen, I would love to tell this story. I don’t think I should. I don’t think I should get personal, but I would love to tell my tax audit story of New York State and New York City since 1997. It happens every year, but that’s not the point. I have to prove 14 different ways where I am every day of the year. I have to prove 14 different ways, ’cause I pay New York state and city tax on a per diem.
When I am there working I pay whatever, you know, my rate is based on income for that day in New York. And I try to go as little as possible. If it weren’t for hurricanes down here, I would never go up there. New York is the escape valve in case hurricanes are showing up in our area, because of the loss of electricity. So I’ll tell you what I’m going to do. I’m going to look for an alternative studio somewhere outside New York, perhaps Texas — another no-income-tax state — and I’m going to get the hell over there, when a hurricane starts coming our way, ’cause I told Mayor Bloomberg: I’ll be the first to lead the way. You know, this is just… I’ll sell my apartment. I’ll sell my condominium. I’m going to get out of there totally, ’cause this is just absurd, and it’s ridiculous — and it isn’t going to work. It’s punishing the achievers for the mistakes and the lack of discipline on the part of a bunch of corrupt politicians that have run that city and state into the ground for I don’t know how many years — and I, for one, am not going to take the blame for it.
And it’s not just high-wage earners. Telecommuting and broadband Internet service has opened up opportunities for middle class families to increase their earning power simply by moving to states that have lower income taxes or a lower cost of living.
I’ve got two examples. My current position allows me to work just about anywhere as long as I have a solid broadband Internet connection. My manager has let me know that she’s fine with me working from home a couple of days a week, and I’ve even done a few hours of work from a small bar in Governors Harbour in Eleuthera. If I wanted to move to a state like Florida, my income could rise due to lower taxes and my cost of living could be lower.
Another co-worker moved from Connecticut to North Carolina, not neccessarily because the tax rate was lower, but because overall living expenses were lower. This move – in effect – provided a higher income and more spending and saving power.
Is this a good learning opportunity? I certainly hope that you take a moment to think about it, especially since the politicians in New York simply don’t get it.