“Higher taxes make millionaires flap their wings, not fly the coop.”
As New York City’s 2025 mayoral race heats up, some members of NYC’s elite have suggested they might exit the city over Democratic nominee Zohran Mamdani’s proposed millionaire tax. In a new opinion piece published in Rolling Stone, Groundwork Collaborative Executive Director Lindsay Owens and Special Assistant and Research Associate Nia Law debunk a familiar refrain that tends to generate headlines more reliably than moving trucks.
Key Excerpts:
“The evidence for millionaire tax flight is scant. If high earners were truly fleeing high taxes, low-tax states would be swarming with millionaires. Instead, the highest concentrations of millionaires are found in high-tax states like Connecticut, Maryland, and New Jersey. And in these states, taxes levied on the highest earners have been broadly successful, with Massachusetts millionaire tax generating an additional $2 billion in revenue than expected in the last year alone.
“And for all the doom and gloom about a mass exodus, when tax rates did increase, millionaire populations continued to climb. In 2021, when New York increased personal income tax rates for millionaires, the state’s millionaire population grew by 21 percent. In neighboring New Jersey, when the state raised taxes on high earners in 2004, only 37 millionaires left the following year. That same year, 3,000 new millionaires were added to the state’s rolls. California’s 2005 millionaire tax hike had a similar effect: The millionaire population increased by 30 percent by 2007.
“Millionaires rarely relocate, not because they can’t afford to, but because millionaires make decisions about where to live just like the rest of us do. Our decisions about where to reside are shaped far more by jobs, family, and quality of life than by tax rates. […] making it hard to believe they’d uproot their kids, abandon business networks, and trade New York’s unrivaled energy and access just to shave a few dollars off their tax bill.
“Mamdani’s proposals would make the city more livable for working people while improving public goods — from transit to child care — that benefit everyone, including those footing a slightly higher tax bill. After all, while billionaires may never ride a free city bus, they would be remiss to ignore that they, too, gain from a city that runs smoothly — one that’s safe, clean, and vibrant — because the everyday people who do ride those buses are exactly who keep New York thriving, and who sustain the fortunes they’re so desperate to protect.”