Government greed to drive billionaires from state

 Stephen Green:

Washington State took a big step this week towards passing a “wealth tax” on the state’s richest residents.

The state — home to uberwealthy Jeff Bezos and Bill Gates, among others — is holding senate hearings on SB 5426, which would portion a 1% tax on “paper wealth” like stocks, bonds, futures, and publicly traded options.

I’m reading the text of the bill right now, and about the first 15-20% of it isn’t even actual law. It’s nothing but happy talk, like “Washington has long led the way with innovative and bold ideas that have changed the world.”

And: “Washington’s wealthiest residents can and should share more equitably in the responsibility of funding these key community programs alongside their neighbors.”

Or: “The legislature intends to disrupt the long-standing systemic inequities in our tax code laid bare by the coronavirus pandemic as we recover, rebuild, and transform Washington’s economy.”

Companion bill HB 1406 got its first public hearing on the Washington House side of the legislature on Wednesday.

Both bills would exempt the first billion in assets from forced sale and confiscation, so the uberwealthy would have that going for them, which is nice.

I won’t bore you yet again with why a wealth tax is a bad idea.

Instead, let’s talk about why it’s a stupid idea.

There is nothing more mobile than wealth, and no people more mobile than the super-rich. Washington trying to collect a wealth tax on the rich would be like playing Whack-a-Mole with a feather duster: silly and ineffective.

Bill Gates could spend a whole lot less than 1% of his net worth — and only the one time, not year after year — to establish residency in some place more wisely run than Washington. Florida, for example. Or maybe Somalia.

Washington wouldn’t just fail to collect their wealth tax; they’d stop collecting the massive taxes that their billionaires are already paying.

...

Leaving Washington for Texas or Florida would already be a big payday for billionaires.  They could even move their businesses and save even more money.  It is what should happen when states get too greedy for their own good.