by Richard K. Munro
The art of taxation consists in so plucking the goose as to get the most feathers with the least hissing. ~ Jean-Baptiste Colbert
The power to tax is the power to destroy. We left NY and NJ because the real estate taxes were exhorbitant. I now have no close relatives there. Everyone moved to Nevada, Arizona, North Carolina and Florida. We live in California where the tax situation is not ideal but thanks to Prop 13 our real estate tax is reasonable and under control which is important now that we are retired. Still gradually our real estate taxes, trash and insurance go up every year. We should be OK but If Prop 13 were rescinded we would sell and take all our savings and property out of state.
I knew a semi-retired doctor in NYC who owned his home free and clear and owed almost $50,000 in real estate tax. He sold his house invested in CD’s and moved away. He was cashing in $20,000 a year in CD’s just to pay his taxes. He said if he stayed in New York five more years he would be flat broke. That is wrong. Now he lives out of state in an apartment and pays zero real estate tax. Previously he paid NEW JERSEY STATE INCOME TAX, NEW YORK CITY INCOME TAX and NEW YORK STATE INCOME TAX as well as FEDERAL INCOME TAX. And he was a man who saved his money his whole life, paid off his home and made a very good salary at his medical profession. But he could not afford to be retired in NYC. Public housing is now the largest single landlord in NYC (about 8%). NYC is becoming a city of the few who are ultra rich and the poor. But taxes and crime are also driving younger New Yorkers and retired New Yorkers out of the region. A recent poll stated : “My family would have a better future if we left New York City permanently.”
The poll found 59% of respondents strongly or somewhat agreed with the statement, while 41% somewhat or strongly disagreed.
Chicago and New York are losing so many people and businesses due to oppressive almost confiscatory taxes AND declining public safety and services. I haven’t been back to either city since the 1990s and I have no intention of living there or even visiting there again. Almost everyone I knew in school has moved out of state.
So back to my first point. The power to tax is a necessary power of the state, city and federal government. But when the state confiscates the savings and property of the retired middle class it is going too far and people will vote with their feet and pocketbooks.