The wealthiest people in New York will face a combined marginal tax rate as high as 51.8 percent given the latest tax hikes by the state, according to a report by Bloomberg Wealth.
Bloomberg talked to experts who calculated that rate on federal, state and city taxes. They said the combined taxes could leave the richest people in New York paying a rate higher than many European countries.
State taxes would be hiked under a budget deal reached Tuesday in New York.
Under the deal, the state tax increase would temporarily rise to 9.65 percent for those earning more than $1.1 million. Income between $5 million and $25 million would be hit with a 10.3 percent rate, and income above $25 million would be hit with a 10.9 percent rate.
The budget deal would see those increased rates expire in 2027.
CNBC reported that the higher tax rates could lead to an exodus of the wealthy from New York city.
Miami Mayor Francis Suarez told CNBC that he has been talking to big firms in New York and other wealthy people as they consider relocating to Florida as the state doesn’t tax personal income.
“Clearly, the toxic climate in New York has led businesses to look to Miami as an attractive place for long-term expansion and relocation,” Suarez said. “We’ve hit a critical mass of interest and excitement in Miami and with these big players coming here, people are beginning to understand that this is very real.”
New York Gov. Andrew Cuomo (D) is hoping that President Biden repeals a part of the tax cut law signed by former President Trump that placed a ceiling on the state and local tax deduction at $10,000.
The ceiling, which helped pay for a reduction in the corporate tax rate, hit communities in New York, New Jersey and a number of other Democratic-leaning districts and states.
“When you talk about this tax package you cannot talk about it without anticipating a SALT repeal,” Cuomo said. “When SALT is repealed, the taxes will be going down.”
The Hill has reached out to Cuomo’s office for comment.
Bloomberg Wealth also noted that New York City would have the highest tax rate on millionaires.