Jeff Bezos introduced this week that he’s shifting from Seattle again to Miami, the place he went to highschool. In doing so, he set off heated debates about state taxes—regardless of by no means mentioning them when saying his resolution on Instagram on Thursday.
As an alternative the Amazon founder, with an estimated web price of $162 billion, expressed his love for Miami and his want to be close to his dad and mom, who not too long ago moved again there. He additionally famous that the operations of Blue Origin, his area enterprise, are “more and more shifting to Cape Canaveral,” about 200 miles to the north.
However his put up, inevitably, sparked hypothesis over state taxes and the way a lot they performed into his resolution. In March, Washington’s Supreme Courtroom, after years of authorized challenges by Republicans, upheld a 7% tax on capital positive factors above $250,000. Florida, in contrast, has no capital positive factors tax.
In the meantime an property tax in Washington applies to estates price greater than $2.19 million (a paltry determine within the Bezos universe) and goes from 10% to twenty%. Florida has no property tax.
In an opinion piece on Bloomberg, columnist Jonathan Levin argued that the billionaire’s transfer “appears to be largely private” and “isn’t a repudiation of tax coverage in Washington state, neither is it an indication that Florida has created the coverage recipe for others to observe,” conceding that “most of us battle to consider it may be that straightforward with billionaires.”
He additionally admitted that the capital positive factors tax “stood to have a huge impact on Bezos, who has offered down billions in Amazon.com inventory through the years.”
And a remark under the column requested why there was no point out of Washington’s property tax and Florida’s lack of 1, with the poster arguing the Bezos property may keep away from paying $32 billion with the transfer.
Within the background, in the meantime, is long-running uncertainty over which state Bezos has really been claiming residency in, coupled with continued efforts in Washington state to move a so-called “billionaire tax.”
In January 2021, Rep. Noel Body, a Democrat from Seattle, launched a invoice to impose a brand new 1% wealth tax on billionaires. Backers argued that as a result of Washington (like Florida) has no revenue tax and raises income from gross sales tax, property taxes, and different taxes, taxpayers on decrease financial rungs pay a bigger share of their revenue in state taxes.
The invoice did not move, as did an analogous one final yr. In January, lawmakers launched one other such measure, becoming a member of state legislatures in California, New York, Illinois, Maryland, Minnesota, Connecticut, and Hawaii in comparable efforts.
Shortly after the invoice’s introduction in 2021, Bezos introduced plans to step down as Amazon’s CEO. Critics of the proposed wealth tax pounced, saying Bezos would absolutely depart Washington.
However Body instructed Geekwire on the time, “I actually suppose that Bezos must be claiming residency elsewhere, which clearly has nothing to do with this proposal or the rest. It’s simply the selection that he made.”
This week, Jared Walczak, vp of state tasks on the Tax Basis, a right-leaning suppose tank, instructed MarketWatch: “By shifting now, Bezos is getting out in entrance of any potential Washington state wealth tax—and he additionally took a big chunk out of any income projections.”
Walczak mentioned that for now the “actual advantage of Florida over Washington for Jeff Bezos is the shortage of a tax on capital-gains revenue.”
He conceded that “folks transfer for a wide range of causes,” however he additionally famous, “When billionaires transfer for no matter motive, they normally land in low-tax states.”
