Posted: 28 Nov 2012 10:53 AM PST
“FRAGILE.” It must be Italian.
Fact – when you tax something, you get less of it:
In the 2009-10 tax year, more than 16,000 people declared an annual income of more than £1 million to HM Revenue and Customs.
This number fell to just 6,000 after Gordon Brown introduced the new 50p top rate of income tax shortly before the last general election.
The figures have been seized upon by the Conservatives to claim that increasing the highest rate of tax actually led to a loss in revenues for the Government.
It is believed that rich Britons moved abroad or took steps to avoid paying the new levy by reducing their taxable incomes.
This isn’t just happening in the once Great Britain.
France’s luxury property market has hit a selling ‘panic’ as millionaires rush to flee the socialist government’s looming tax hikes, a leading estate agent has revealed.
More than 400 Paris homes worth more than €1million have been put on the market since President Francois Hollande came to power in May – more than double the same period last year.
Many of France’s super-rich want to escape to ‘wealth-friendly’ countries like Britain, Switzerland and Luxembourg.
Forget Great Britain, it seems:
The exodus has been triggered by a new higher tax of 75 per cent on all earnings over €1million – £780,000 – which will come into force later this year.
They also fear more tough new taxes on moving money overseas and sales of company shares.
As Italy swelters in temperatures of up to 40C, the country’s marinas should be packed with bronzed sailors in expensive deck shoes tending to their gleaming yachts.
But Italian boat owners are feeling the heat not just from the sun this summer.
Thousands are weighing anchor and fleeing with their gin palaces to quiet corners of the Mediterranean to escape a tax evasion crackdown – part of efforts by the government of Mario Monti, the prime minister, to tackle Italy’s €1.9 trillion public debt.
Finally, John Kerry:
As a multimillionaire married to Teresa Heinz Kerry of the Heinz ketchup fortune, Kerry’s best known tax gaffe was mooring his $7 million yacht outside his home state of Massachusetts. Saving taxes on a pricey yacht might seem unpatriotic anywhere, but cheating your own state was worse. Kerry moored the vessel in Rhode Island so he could save the $500,000 in taxes a Massachusetts berth would trigger.
What is the lesson here?
When you make it more likely that a person will lose a large portion of their property, they will leave to protect said property.
This results in a decrease in revenues.
Instead, drop the taxes and take a smaller percentage, but from far more people.
It worked for WalMart and it would work for DC.