Oregon’s Millionaire’s Tax Doesn’t Pan Out

To close its $3.8 billion FY 2010- FY 2011 projected budget gap, Oregon has relied on an evaporating stimulus, budget cuts of roughly 9 percent and tax increases. The state’s income tax was raised with a new top rate of 11 percent. However the tax on the richest two percent of residents hasn’t performed as expected. Last year the new tax rate brought in $180 million. This year collections dropped to $130 million. The Wall Street Journal writes this shouldn’t be suprising. A full quarter of “rich tax filers seem to have gone missing.” it’s likely millionaires will be looking for other places to domicile. The tax applies to stocks and capital which means Oregon has “virtually the highest capital gains tax in North America.”

6 thoughts on “Oregon’s Millionaire’s Tax Doesn’t Pan Out

  1. Pingback: The American Spectator : AmSpecBlog : Must-Reads

  2. HarlemGhost

    guest …

    please note the “new” rate brought in 180 million in 2009 … they expected to receive that same amount or more in 2010 …
    so based on the article they may have increased their tax receipts by 130 million compared to 2008 …

  3. Occam's Tool

    HarlemGhost: the first year, with the “millionaires” trapped, it brought in $180 million more. In one year that extra amount dropped $50 million, which means roughly $450 million of total revenue left Oregon, and that means half a billion less to spend in Oregon. Great way to grow the economy ($50 million X 9, which is the inverse of eleven percent). Next year I expect the tax will capture even less.

  4. Anonymous

    Why do governments continue to do this? If you were rich and could live wherever you wanted, why stay in Oregon if the state is going to penalize you? Yet liberal states repeatedly play this and it always ends the same way. I think a better way is an auto reduction in the governments budget, and a refund for us, every time their policies fail.

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