Friday, July 09, 2010

LeBron James To Miami: A Tax Refugee?

Any why not? Why in the world would you pay millions upon millions of dollars for the "privilege" of working in New York, New Jersey, or Cleveland? I can't speak for LeBron, but this sure as hell would have influenced my descion:

The tax savings for James in Miami over New York City would be staggering, according to the Post’s analysis.

“On a five-year contract worth $96 million -- what he'd get from the Knicks or the Heat -- LeBron would pay $12.34 million in New York taxes.” Florida has no state income tax.

New Jersey and Ohio, the other reported frontrunners to attract James, also have state income taxes, but they are not as his as in New York. Based on a $96 million contract, James would pay
$5.69 million in state taxes if he re-signed with the Cleveland Cavaliers. If he signed with the New Jersey Nets, James would pay $10.32 million in state taxes.

LeBron is smart, and whether he intended to or not, he has taught a great economic lesson to liberals, who believe with the fervor of the rightous that another "millionaires tax" is all any state/federal government needs to avoid cutting spending.

Of course, a tax on millionaires (in New Jersey, where math education is not what it used to be, the recently vetoed "millionaires tax" kicked in at $400K) affects everyone, rich and poor. To wit:

Robert Schoenberger and Teresa Dixon Murray of the Cleveland Plain-Dealer estimated that downtown Cleveland businesses will lose $48 million over the course of the NBA season without James.

Apply that thinking to New York. Adding LeBron James to the Knicks would have added tens of millions in tax revenue taken off the top of every ticket and t-shirt sold - in other words, the state would have taken a cut of every "Lebron dollar" spent. But no, instead they insisted on a outsize tax - a punitive one, really - on the the man who would provide their city/state with the ability to generate additional revenue by his mere existence.

But Lebron felt he shouldn't be punished for his ability to make money, and so walked away from the Big Apple. And the greedy parliament of whores that make up the state legislature have now lost a lucrative form of revenue that would have lasted for years because of their insistence on punitive taxes on the men of ability, the men who create the wealth they see fit to confiscate.

We've seen this happen before, incidentally - here's a two minute drill on how "soak the rich" economics really works:

Maryland couldn't balance its budget last year, so the state tried to close the shortfall by fleecing the wealthy. Politicians in Annapolis created a millionaire tax bracket, raising the top marginal income-tax rate to 6.25%. And because cities such as Baltimore and Bethesda also impose income taxes, the state-local tax rate can go as high as 9.45%. Governor Martin O'Malley, a dedicated class warrior, declared that these richest 0.3% of filers were "willing and able to pay their fair share." The Baltimore Sun predicted the rich would "grin and bear it."

One year later, nobody's grinning. One-third of the millionaires have disappeared from Maryland tax rolls. In 2008 roughly 3,000 million-dollar income tax returns were filed by the end of April. This year there were 2,000, which the state comptroller's office concedes is a "substantial decline." On those missing returns, the government collects 6.25% of nothing. Instead of the state coffers gaining the extra $106 million the politicians predicted, millionaires paid $100 million less in taxes than they did last year -- even at higher rates.

Is there a lesson learned here? Not by liberals and Democrats, unfortunately - they're all soccer fans...

No comments: