Why Are the Super Rich Moving Out of New York?

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Nov. 7 (Bloomberg) -- Travis H. Brown, author of "How Money Walks," discusses why the super rich are moving out of New York with Trish Regan and Matt Miller on Bloomberg Television's "Street Smart." (Source: Bloomberg)

What is causing this mass exodus of money?

But we're looking at is the past 18 years of internal revenue service data that tracks all adjusted gross income, and it shows for example, manhattan or in the empire state as a whole, that a new york minute now costs $7,100. they are generally moving from the northeast to places like florida.

Florida is one of nine states that puts a zero price on work at the state level.

No personal income tax.

You are talking about an opportunity to save anywhere from six percent to 13% on your income.

Because of taxes, people are moving out of certain areas and moving to other areas because they have fewer penalties in the ways of taxes?

That's right.

It is not just north to south.

Your home state of new hampshire . live free or die, no personal income tax.

No sales tax either.

Still doing very well with their state budget.

It seems so american.

What went wrong with the other 41 states?

Are people moving into new hampshire?

That's right.

The red states are contributing to new hampshire.

The green states are the few places where a new hampshire resident would prefer to go other than their home state.

The entire country goes from green to red in texas.

All of these red states are contributing their income, their jobs into the state of texas, which we know has done incredibly.

It has done great with energy, and there is a tax incentive to be there.

What about nevada, california right next door?

When they look at another no income tax state right next to california, which in our analysis was losing $45 billion, previously 10 point three percent price on work, now 13.3% for silicon valley entrepreneurs.

It's real easy to go right next door to clark county, nevada, or reno, nevada, escape and lower your price on work.

There is something bigger at stake here.

If you have more money going to another state, it's better news for the overall economy and for job growth.

Are we seeing corporations relocate as well?

That's exactly what we're seeing, not only the fortune 500 moves into texas, but as we mentioned, florida is attracting not only individuals, folks looking for retirement, but major corporations.

Just recently news from hertz rent a car, consolidating operations out of oklahoma to florida.

We do have a new mayor in new york, and he is taught -- talked about raising the top income rates.

I cannot get out of new york.

I have to be here for my job.

When the new mayor was elected i thought, could we see an exit as of capital?

-- exodus of capital?

A couple of firms have moved to new jersey.

Other than that, there's no place to go.

Many people have been in new york city because of the gain on trade and unique services such as media or financial services.

But we are seeing not only across the country, but the world of financial service firms, hedge funds can operate out of puerto rico, and globally, if the advantages are distinct and notable enough.

That's taxes, also regulation with some hedge funds choosing to relocate offshore.

What's the big take away here for us?

We know as a group the nine states that do not put a price on work at the state level are collectively adding $164 billion over the previous 18 years, and the reverse is also true.

The nine states with the highest burden on income are losing nearly $150 billion.

We want folks to know, where is a smart place to work, grow.

You have to pay for services in many of these places.

If you don't have the income tax, how can you guarantee the better education system, better services?

Where does the money come from.

Growth in the private sector, which is why it may be a surprise to some to think there are more educators in texas per 10,000 residents than there are in california.

That is why states like washington state, with a different climate, are showing growth, over $12 billion.

They are growing receipts for essential services as well.

You don't have to sacrifice that to do all these essential things.

You are advising governor cuomo, if you were advising mayor elect de blasio, we would say to them -- you want to make sure capital is welcome in new york to stay, or welcome to grow and come here.

This text has been automatically generated. It may not be 100% accurate.


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