Flight of Affluent Taxpayers Catches Up With New York
The latest personal income tax data shows the state bringing in less revenue than it did before the pandemic, which could hamper its ability to pay its bills.
New York relies on income taxes paid by those making $200,000 or more a year for almost half its revenue.
Photographer: Luke Sharrett/Bloomberg
The state income tax charts in this column omit some key information: revenue from the pass-through entity tax that New York created in 2021 so that partnerships and S-corporations that previously paid state personal income taxes could circumvent the $10,000 federal cap on state and local tax deductions. Include that, and the state’s revenue picture is much less dire, as I detail in a February 2024 piece that I recommend you read instead.
New York has been losing people to other states for a while. But something new happened during the pandemic: The people who left had higher incomes than those who stayed behind — much higher.