In a recent Wall Street Journal op-ed, conservative economists Arthur Laffer and Stephen Moore, both of whom have advised President Donald Trump, say that 800,000 people from New York and California will leave their home states by 2021 as a result of the new tax bill.
Laffer and Moore say that the effective income-tax rate in these two states will increase from between 8.5 percent to 13 percent for high-earning Californians, and in New York, those earning $10 million or more will see an increase of 50 percent or more. On the other hand, Stanford economist Cristobal Young says the forecast is "pure nonsense," CNBC reports. Young added that the people most affected by tax rates are the "late-career working rich" who are less likely to move as they are "embedded in place for a host of social and economic reasons."
Young's study, done with Charles Varner of Stanford University, and Ithai Lurie and Richard Prisinzano of the U.S. Department of Treasury, analyzed 13 years of income data for all Americans earning $1 million or more and they found that only 2.4 percent of million-dollar earners move every year. That rate is lower than the 2.9 percent move rate for the broader population. They found that only 0.04 percent of millionaire earners move for tax reasons.
