WSJ Article (Click Here)

What State are they talking about? Connecticut? They’re pikers contrasted to the great state of 10,000 taxes. Minnesota just didn’t raise individual income taxes a tiny bit to 6.99% like Connecticut; Minnesota enacted the new top Edina tax rate of 9.85%–a 25% increase in 2013! That’s almost 50% more than the Connecticut top rate.

We know the east coasters are a little backwards, so it might be a suggestion to have Connecticut send a team of legislators out here for some OJT on how to do it right. We also deposed Connecticut in 2013 of its number one ranking in estate taxes. Tsk, tsk!

Just because tax revenue on the rich in Connecticut is leveling off and maybe dropping is no reason to not hit ‘em harder again. Think of it like the capital gains rate—the more you increase it, the less revenue you derive. The Laffer Curve sets in and you continue to lose more but that should not be a political obstacle to taxing the rich more, after all, it’s not revenue that really counts but votes. Those top 100 richest of the rich earners and the other 11,000 top earners are peanuts in the scheme of things. They should be good libs and want to be taxed more. They have more disposable income so it’s appropriate that the state should help them dispose of it. Nor should a drop in your bond rating and the consequent increase in your debt servicing expense be a factor. What are taxpayers for?

On a little more serious note, we think the 2015 revenue year is somewhat of an anomaly. The market went crazy on large realized capital gains. Connecticut and Minnesota appear to tax these fully. That activity dropped in 2016 and there may have been less to tax. Not good.

Minnesota nice welcomes those fleeing high tax states. We will even throw in high real property taxes to make you feel comfortable.

Bob Smith 3rd
Gopher State Politics Institute
bob@gopherstatepolitics.com