Wall St. Journal: “Income tax rates go up, rich taxpayers vanish. . . . after passing a millionaire surtax nearly one-third of Maryland’s millionaires had gone missing, thus contributing to a decline in state revenues. The politicians in Annapolis had said they’d collect $106 million by raising its income tax rate on millionaire households . . . the state comptroller’s office now has the final tax return data for 2008, the first year that the higher tax rates applied. The number of millionaire tax returns fell sharply to 5,529 from 7,898 in 2007, a 30% tumble. The taxes paid by rich filers fell by 22%, and instead of their payments increasing by $106 million, they fell by some $257 million.”
This is more proof that politicians are totally disconnected from reality. The stupid Maryland legislators who voted to increase the tax on the rich were incapable of understanding the laws of economics. There’s only one thing the stupid Maryland legislators can do now and that is pass more tax increases that will further decrease tax collections. Maryland could also pass an “Amazon” tax to further reduce state income tax revenue. See “Amazon Tax Signals Business Unfriendliness & Will Worsen Short-Term Budget Problems.”
Update: See The Tax Policy Blog’s post called “Maryland Lawmaker Proposes Making Millionaires’ Tax Permanent.” Delegate Jolene Ivey (D) introduced a bill in the Maryland legislature that would make the temporary millionaire’s tax permanent. The idiot said “”Programs that help children, the elderly, the poor, the environment, education, the arts, the unemployed—everything’s on the chopping block. Millionaires should continue to share in the pain.” When you practice the religion of tax and spend like Ms. Ivey, you have faith that increasing taxes is good, but that faith prevents a true believer from facing the reality now proven in Maryland that the millionaires tax decreased revenue by $257 million in its first year. Once again, we have proof that those who ignore history are doomed to repeat it.