In response to reports of the sagging luxury real estate market in Manhattan, blaming the capping of the State and Local Tax deduction for the drop in demand, Senator Rick Scott of Florida has written an op-ed in the Wall Street Journal explaining exactly why New Yorkers are fleeing to low tax Florida. He writes:
A recent article in a Beltway publication warned about a potential recession and considered how it might affect President Trump’s chances at re-election. The story began—no joke: “The luxury real estate market in Manhattan is sagging.” It goes on to argue that softening in the real-estate market in high-tax Northeastern states is caused by the 2017 tax-reform law. Thus the claim is that because taxpayers can deduct only $10,000 in state and local taxes from their federal returns, America is heading for a recession.
Nonsense. The tax-reform law stops high-tax states from burdening the rest of us with their irresponsible decisions. America is a marketplace where states are competing with each other, and New York is losing. Their loss is Florida’s gain—and Texas’ and South Carolina’s and Ohio’s and Indiana’s.
I would like to tell New Yorkers on behalf of the rest of America that our hearts go out to you for your sagging luxury real-estate market. But you did this to yourself, and you can fix it yourself. If you cut taxes and make state and local government efficient, maybe you can compete with Florida again.
I’m an outsider to politics and spent most of my career in business. I ran both small and large companies—a doughnut shop and the country’s largest health-care provider. I employed hundreds of thousands of Americans and was responsible for making payroll for most of my career. But I grew up in public housing, in a family that struggled for work. I know how important it is to get people back to work.
When I ran for governor in 2010, I evaluated Florida as a turnaround opportunity. It had great assets—and, more important, great people—but was suffering from mismanagement and a lack of leadership. The naysayers said a businessman can’t make government work. They were wrong. My administration cut more than $10 billion in taxes and more than 5,000 burdensome regulations. Florida businesses created nearly 1.7 million new jobs. We paid off more than one-third of our state debt over my eight years as governor while we made record investments in education, transportation and the environment.
I made more than 20 trips to high-tax states like California, Connecticut, Illinois, New York and Pennsylvania to lure businesses to Florida. The tax-happy leaders of those states were furious, which made the visits all the more enjoyable for me. They called me every name in the book. But they were the ones who raised taxes, and bad decisions have consequences.
The elites in New York and Washington should commission a study of Florida to see what happens when conservative ideas are put into practice. The luxury real-estate market in Manhattan may be sagging, but Florida’s economy is thriving, expanding at a record pace.
It is within the power of high-tax state politicians to relieve their constituents of the burdens of the cap on State and Local Tax deductions. Simply lower the state’s tax burden and watch growth soar, citizens stay, and businesses flourish. The ideas are not new:
- Is Your State a Property Tax Hell?
- Americans Want to Leave Their High Tax States
- Is Your State Winning or Losing the Tax Game?
- The Best States for Retiree Taxation
- Cato’s Chris Edwards: Tax Reform and Interstate Migration
People will go where their money is treated best. Politicians in high tax states view their constituents’ money as an asset with which to fund their dreams. The citizens think otherwise, and they are voting with their feet.
E.J. Smith - Your Survival Guy
Latest posts by E.J. Smith - Your Survival Guy (see all)
- If You’re a Highly Effective Person, We Should Talk - March 24, 2023
- What’s Happening to Charles Schwab? - March 24, 2023
- Prepare for the Predictable - March 24, 2023
- Is Vanguard Voting Against Your Political Beliefs? - March 23, 2023
- Call It the Difference between Normal and Crazy - March 23, 2023