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Come Saturday Morning: GOP Tax Lies about Maryland and Oregon

Watching Republicans lie about taxes and money can be entertaining, such as what we’re seeing happen with any Republican who dares touch the leprosy-transmitting kryptonite known as Paul Ryan’s Fantasy Budget. But that doesn’t mean the lies are any less nasty — or that we can depend on the evening news to swat down these lies.

For instance, there are the lies, pushed in part with the repeated Murdoch Wall Street Journal‘s editorial page’s assistance, about rich people allegedly fleeing Oregon and Maryland in droves. BSP’s Sally Jo Sorensen catches a state legislator, Gruesome Glenn Gruenhagen, last seen being, um, freaky (hence the lovely Tildology graphic illustration), spreading the baloney via his e-mails to his constituents:

Maryland and Oregon each passed tax increases on top earners only to end up collecting far less revenue than anticipated. Both states lost approximately one-third of their high-income filers, who relocated to tax-friendly states like Florida. They didn’t necessarily move their entire business out of state, but relocated themselves enough days a year to meet tax-filing requirements.

Wrong, wrong, wrong. Here are the facts, for Oregon:

Measure 66 would yield an estimated $300 million, rather than the projected $472 million. Those seeking evidence of tax flight, however, faced a problem: Measure 66 was retroactive to 2009, and much of the shortfall was based on revenues from that year. To leave the state and avoid higher tax rates, a high-income taxpayer would have had to see Measure 66 coming more than a year ahead of time.

The decline in tax collections from upper-income people occurred mainly because they, like everyone else, had been affected by the Great Recession. Some who had incomes above the Measure 66 threshold fell below it. Others saw steep declines in their income from dividends and capital gains, nearly all of which goes to people in the top tax brackets. The revenue projections for Measure 66, based on income information from 2008, were bound to be far from the mark.

And here are the facts for Maryland:

[A]s a result of legislation enacted in 2007 and in 2008, income tax rates for affluent Marylanders were higher this past year, not just for residents with taxable incomes over $1 million, but for individuals with taxable incomes above $150,000 and for families with incomes over $200,000. Consequently, if it is the case that wealthier taxpayers respond to changes in income tax liability by changing their state of residence, one would expect to see that response not just for taxpayers with incomes above $1 million, but, to some degree, among all affected taxpayers. The Comptroller’s preliminary data suggest that this is not the case.

With the exception of “millionaires”, the number of returns in the affected ranges of taxable income appears to have grown between 2007 and 2008. Given recent economic events – and, in particular, the widely-anticipated decline in income from capital gains, which are received almost exclusively by the very wealthiest residents of each state – a far more likely explanation for the alleged disappearance of Maryland’s millionaires is that, for 2008 at least, they are no longer millionaires. Instead, their incomes may now fall in lower ranges of the distribution, thus potentially accounting for some portion of the increase in the number of returns in those ranges.

Read it, spread it, link to it. Thank you.

As an aside, it occurs to me that one of the chief values of FDL is that we are going to tell you the truths you won’t find on CBS, NBC, ABC, or CNN, much less FOX. (The story above, for instance, is not one you’ll see on network TV.) That, coupled with FDL’s activism, is why I find it indispensable. Seriously. There are many, many times I find an obscure story somewhere else and rush to show it to my Firedoglake colleagues, only to be told “Emptywheel (or Peterr, or bmaz, or Cindy, etc.) covered that last week”. Even better than learning what’s really happening is the ability to affect what’s happening — and FDL provides that in a very intimate and meaningful way.

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