Tuesday, July 5, 2016

Why Everyone Needs a Tax Cut: Scientists like living in countries that don’t plunder their paychecks

WSJ editorial. Excerpts:
"One study, by Ufuk Akcigit, Salomé Baslandze and Stefanie Stantcheva, looked at the international migration patterns of highly successful inventors since 1977. The authors found that “top 1% inventors”—those with the most valuable patents—“are significantly affected by top tax rates when choosing where to locate.” Specifically, countries enjoy a “26% increase in foreign superstar top 1% inventors” with each “10 percentage points decrease in top tax rates.”"

"In another study, Enrico Moretti and Daniel Wilson examine star scientists “at or above the 95th percentile in number of patents over the past ten years” to find that state taxes have “a significant effect” on the geographical location of these innovators. In short, they found, “relative taxes matter.” 

The study notes that “migration flows are more sensitive to changes in the 99th percentile tax rate than changes in taxes for the median income” and that the “probability of moving from state o (origin) to state d (destination) increases when the net-of-tax rate (hence after-tax income) in d increases relative to o.” Even scientists prefer to pay lower taxes."

No comments:

Post a Comment