Governments say they can't tax the super wealthy more because they'll just leave the country but has any first world country tried it in the last 50 years?

[u/Discontitulated]

It would be interesting to see how raising taxes on the super wealthy actually affected a first world country's tax revenue and economy.

Are our first world economies really so fragile the rely on the super wealthy and their meager tax revenue?

[u/EastRoom8717]

States have tried it, and now those people live in other states.

For example: https://www.nytimes.com/2016/05/01/business/one-top-taxpayer-moved-and-new-jersey-shuddered.html

[u/AvonMustang → u/EastRoom8717]

Came to say this - you don't even have to look to other countries to see this happening. California is a great example of not only people but businesses leaving because they are taxed too high. Similar happening in Seattle where they have taxes that only apply to larger companies.

[u/Qinistral → u/EastRoom8717]

Washington taxes are blamed for Bezos leaving state too. But it’s hard to really evaluate it with such few datapoints and the billionaires often giving alternative explanations.

[u/AZPolicyGuy → u/EastRoom8717]

Anecdotes aside, most academic studies on state-level tax flight indicate taxes have little to no impact on living decisions. Ranks extremely low on survey data. This book is one of the most comprehensive reviews of the subject - it was supremely helpful when I was conducting my own review of state and federal tax decisionmaking while working in a policy shop.

Not as familiar with the subject in Europe, so I can't speak to it. I assume decisions made in Europe and other tax havens is why Piketty specifically advocates a global wealth tax.

[u/Zealousideal-You4638 → u/AZPolicyGuy]

This is something I thought about. Many cite instances of taxes being raised then being followed by the wealthy immigrating but this isn't an entirely convincing argument. I don't know enough to say either or but I can easily see it being a correlation-causation fallacy. Whenever taxes on the wealthy are raised severely there tends to be a lot of common political, economic, social, and cultural factors that encouraged such policy. Two that come to mind is economic hardship that encourages people to advocate for wealth distribution, and a general disdain for the rich encouraging their taxation. These could also be factors into their immigration.

I think there's a knee jerk reaction to counterargue that these explanations are simply less likely than the loss of capital & money they'd experience, but honestly when you own millions losing thousands is so insignificant to your quality of life that its not impossible that these other explanations very well may be the truth. I need to read more on the subject before I make a comprehensive judgement, but I definitely think this subject is much more nuanced than the "Norway had millionaires leave, the end" interpretation a lot of people are giving.

[u/Sundae_2004 → u/AZPolicyGuy]

If your argument is so compelling, I wonder why recurring articles in NARFE (National Active and Retired Federal Employees [assn]) are so often treatments of state taxes; e.g., https://issuu.com/narfe/docs/narfe_0424_web