In the game of fiscal policy, taxpayers can avoid the impact of excessively punitive fiscal policies by… “Vote with your feet” And move your residence to places where taxes are lower. In the United States, the migration of individuals (and businesses) from one jurisdiction of the country to another is a long-term phenomenon that highlights how government decisions can directly affect the fortunes of territories, attracting or repelling wealth.
Last November, the founder and CEO of Amazon and one of the richest men in the world, Jeff Bezos, he starred in a story of this kind. The businessman decided to leave his life in Seattle, Washington, and move to Miami, Florida. Although Bezos stated that this move was in response to personal reasons, it did not go unnoticed that one of the main consequences of his departure would be to avoid the “tax on the rich” imposed by the UAE. Washington taxes capital income received by wealthy taxpayers at 7%.
Bezos’ decision to move to Miami would pay very positive dividends financially from then on Florida imposes no “tax on the rich” and does not impose any state income tax surcharge.. In addition, business and property taxes are more moderate in the East Coast region than in Washington State.
“Seattle has been my home since 1994, when I started Amazon in my garage,” Bezos admitted when asked about his decision. This statement highlights its roots in the northwestern American city and emphasizes the importance of change. After decades of emphasizing his commitment to Seattle, Bezos’ decision to move to a state with more favorable tax policies speaks louder than his previous words on the issue.
The migration of individuals and companies for tax reasons is by no means a new phenomenon. In fact, the transfer of taxpayers from some American territories to other regions has increased in recent years. The two regions of the country most affected by this phenomenon are California and New York, with Florida and Texas being the regions with the largest population and wealth. In 2022 alone, these operations cost California and New York taxpayers a combined annual income of $54 billion.
