Maybe France's 75 Percent Tax on the Rich Won't Send Them Packing After All
French millionaires may not flee the country.
When French president Francois Hollande unveiled his 2013 budget and kept his promise to hammer the rich with a 75 percent tax rate, conservatives howled. Bernard Arnault, France's richest man, filed for Belgian nationality. Reuters estimated that 300,000 French millionaires might pack up their yachts, private planes and butlers and head for greener pastures.
While Hollande's "millionaire's tax" may yet prove ruinous to the French economy, there's one thing it's likely not going to do: spark a rich exodus, at least according to a research report (PDF) from Stanford's Cristobal Young and Charles Varner. Studying California income tax records they found that the movement of millionaires to and from the state had almost no connection to the tax rate. It echoed findings from a similar study conducted in New Jersey.
While the Eurozone has made it easier for citizens to move around Europe, it's doubtful that it's made relocation easier than state-hopping in the U.S.