New Jersey's leaders had a great idea for balancing the budget a few years back. Tap the state's wealthy through hikes in income taxes, property taxes and even a "wealth tax". So, how's that working out? Not so well, reports the Newark Star-Ledger:More than $70 billion in wealth left New Jersey between 2004 and 2008 as affluent residents moved elsewhere, according to a report released Wednesday that marks a swift reversal of fortune for a state once considered the nation's wealthiest.The story notes that this is a reversal from the five years prior to 2004, when wealthy people were moving into the state. All of that stopped abruptly with the tax hikes. That's a big problem for the Garden State because the top 1% of taxpayers pay about 40% of the state income tax. As one expert quoted in the story dryly notes, the loss of those residents may explain state budget shortfalls.
Conducted by the Center on Wealth and Philanthropy at Boston College, the report found wealthy households in New Jersey were leaving for other states -- mainly Florida, Pennsylvania and New York -- at a faster rate than they were being replaced.
Wow, who knew the wealthy actually had the resources to relocate themselves if they decided taxes were too high?
An alternate theory -- that they are fleeing the state in embarrassment over the "Jersey Shore" reality TV show -- doesn't hold up since the exodus predates the show's premiere. It probably isn't helping though.