By Svea Herbst-Bayliss
For decades, New York bankers and fund managers have embraced the city’s high tax rates as part of working for one of the world’s leading financial capitals.
However, plans are underway to raise interest rates as part of a New York state budget agreement, and some lenders have shown that working on Wall Street may no longer mean working on Wall Street. Boldly looking for an exit.
“I’m already looking for an apartment in Florida,” said a high-paying man from a prestigious bank who asked his employer not to reveal his identity because he didn’t yet know his plans to move.
Others, who earn more than $ 1 million, are considering more bold steps, such as moving their entire investment firm out of the city, claiming that their ability to pay staff will be taxed. I am.
In a proposal to pass the New York State Legislature, New York City’s top earners will pay up to 15.73% of state and city taxes combined.
New York State income tax rates currently range from 4% to 8.82%, New York City tax rates range from 3.08% to 3.88%, and maximum income is paid close to 12.7%.
Called the “Millionaire Tax,” this proposal adds extra charges to those who earn more than $ 1 million a year, defeating California’s provinces and claiming the country’s highest total tax rate.
For those who earn more than $ 1 million and put them in the higher tax rate range, the city’s cultural offering, which has long been an ointment, benefits from lower tax rates such as Florida, Utah, and Texas. Some say it’s no longer better. Successful remote work during a pandemic.
Passage seems likely
The tax bill that is likely to be passed is the culmination of the battle between progressive Democrats and moderate Democrats. Until recently, New York Governor Andrew Cuomo resisted the millionaire tax.
Political dynamics have made extensive lobbying of businesses and wealthy individuals almost meaningless.
Major financial companies such as Goldman Sachs Group Inc, Virtu Financial Inc and hedge fund Elliott Management have already said they will move some staff from New York.
Large companies probably won’t completely abandon their New York headquarters for tax reasons, but some staff and small businesses, such as hedge funds, which employ only dozens of people, are informed. The source said. “This is real,” said one of the smaller fund managers. “This creates an overwhelming incentive to move.”
Last month, a group of business leaders, including JPMorgan Chase and Company, Citigroup, Inc. and BlackRock, Inc., issued a public letter warning that the rich would move out of New York in the event of a significant tax increase. We took the unusual measure of issuing it. ..
Companies may have to move staff from New York because they don’t want their best talent to be taxed at a high level. Some companies have already begun to move for expense and corporate tax purposes, people familiar with the move said.
“When wealthy people don’t like something, they don’t protest, they just leave,” said Jeffrey Waynestein, a tax lawyer at Cole Shots.
“Wealthy people are under attack and are looking for a way to lose 15%. They are looking for options.”