Wednesday, April 06, 2011

If You Tax Something, You Get Less of It

From the Boston Globe:

"Fidelity Investments will shutter its offices in Marlborough, Massachusetts by the end of next year and move almost all of the 1,100 jobs there out of state, a spokeswoman said yesterday. The financial services giant, based in Boston since it was founded in 1946, has steadily slashed its Massachusetts workforce in the past five years. Fidelity will probably have about 7,300 workers left in Massachusetts, just over half of the 13,000 it had in 2006. Most of the jobs will be relocated to other states, with the lion’s share going to existing offices in Merrimack, N.H., and Smithfield, R.I.

Several observers said it appears Fidelity is relocating to states that will offer more tax breaks, or where it believes it can cut operational costs, especially since many of the jobs are moving only across the Massachusetts border."

From the Boston Herald (thanks to Steve Bartin):

"A clandestine company that manages billions for Fidelity Investments has quietly pulled up stakes from Boston’s Financial District, leaving the Bay State behind for New Hampshire and its beneficial trust and tax laws. Crosby Advisors’ relocation of more than 100 workers to new offices in Salem, N.H., last fall — marking a major migration of Boston wealth over the border — went virtually unnoticed except among informed company insiders.

The move also went completely unmentioned amid all the hand-wringing after Fidelity announced last month that it would close its Marlboro campus and send most of those 1,100 jobs to its offices in Merrimack, N.H., and Smithfield, R.I."


16 Comments:

At 4/06/2011 9:32 AM, Blogger Monkeesfan said...

Told this, the Democrats all screamed, That's impossible! You're lying! It cannot be true!

 
At 4/06/2011 9:39 AM, Blogger Che is dead said...

Socialism, even in it's mildest forms, requires walls, in the same way that antebellum plantations required chains.

 
At 4/06/2011 10:55 AM, Blogger morganovich said...

che-

if you want to get a good look at the walls, take a look at the US tax code around giving up your citizenship.

giving up us citizenship is a (heavily) taxable event. every asset you own is market to market and treated as sold.

they have gone to great lengths to makes sure that leaving is VERY expensive.

mustn't let the milchcows get away... (or if they insist, better milk the hell out of them one last time)

 
At 4/06/2011 10:56 AM, Blogger morganovich said...

This comment has been removed by the author.

 
At 4/06/2011 11:12 AM, Blogger Buddy R Pacifico said...

Rhode Island's tax reform package, of lower marginal rates and simplification, took effect January 1, 2011. Hmm.

 
At 4/06/2011 11:24 AM, Blogger Methinks said...

Morganovich -

Not only that, but the property is taxed again when it is actually sold. Also, although it doesn't have to, the U.S. often bans those who have renounced their citizenship.

BTW, you can get around the additional exit tax by liquidating your assets (if that's reasonable) before renouncing.

Finally, ultimately renunciation isn't even up to you. It's entirely at the discretion of the U.S. government. If you haven't citizenship in another country at the time of application, the U.S. won't even entertain the idea.

 
At 4/06/2011 11:40 AM, Blogger Free2Choose said...

Monkeesfan said,
"Told this, the Democrats all screamed, That's impossible! You're lying! It cannot be true!"

Monkee - That's because they know all of this is just a lie being spread by "astroturf". You know....like the astroturf that handed Pelosi her minority post.

 
At 4/06/2011 11:50 AM, Blogger morganovich said...

methinks-

i have dual citizenship in a tax haven. (st kitts) if you have dual, they have to let you go. (but not your assets until they are satisfied, and expect a NASTY audit.)

selling all your assets is effectively the same as the tax policy. it really does not provide any benefit.

note that the US will tax you as a US citizen even if you are not if you spend too much time here. it's called being a "US person". if you spend more than about 110 days a year (or 180 in any one year) here on a 3 year basis, you qualify.

thus, if you were a french college student in the US with a french father who dies, you would legally owe us inheritance tax on his estate.

the only country in the world with more draconian worldwide taxation is north korea.

the US milks its rich far harder than any other nation.

all you have to do in europe is get your assets offshore and you avoid most tax.

 
At 4/06/2011 11:50 AM, Blogger Buddy R Pacifico said...

Methinks, the U.S. Government will let you renouce U.S. citizenship without other citizenship. The government does try and explain that international travel will be difficult without cititzenship somewhere else. You might want to read this before you renounce. Good luck and please post freely (if possible) from wherever you anchor.

 
At 4/06/2011 1:12 PM, Blogger James said...

Explain the Advantages of a Flat Tax

If you tax something you get less of it. That is econ 101 the price goes up the volume goes down. A flat tax is a tax on consumption. Consume more pay more. With a flat tax consumption goes down.

Germany is an export economy so that a tax on consumption is not a problem but it would be a problem for them to put a tax on exports. We are a consumption economy. We need consumption to do well. Would a consumption tax here not do as much harm to us as an export tax would to Germany?

 
At 4/06/2011 2:31 PM, Blogger morganovich said...

james-

all taxes reduce consumption, it's just a matter of how and for whom and what.

your post says nothing about a flat tax per se, particularly as it is still an income, not a consumption tax. you seem to be confusing flat tax with VAT.

 
At 4/06/2011 3:10 PM, Blogger Benjamin said...

Can we tax farting?

 
At 4/06/2011 3:36 PM, Blogger James said...

Morganovich,

Thank you for the correction. I was under the impression the flat tax was a VAT.

 
At 4/07/2011 2:25 AM, Blogger Accounting Tampa said...

Thanks for the information on the Flat tax.
Now i got explained how the vat and flat taxes are important.... thanks for the nice article on flat tax

 
At 4/07/2011 9:36 AM, Blogger morganovich said...

"if you tax something, you get less of it"

can we tax benji?

 
At 4/07/2011 3:30 PM, Blogger Ron H. said...

morganovich

"if you tax something, you get less of it"

can we tax benji?
"

I like your idea of putting him in the army better. That should tax him plenty.

 

Post a Comment

Links to this post:

Create a Link

<< Home