NY Sees Dramatic Exodus of Millionaires — Causing Nearly $11b Loss in Tax Revenue: Study
By Carl Campanile, Vaughn Golden, Craig McCarthy and Matt Troutman
Lacks the rich.
New York’s share of US millionaires dramatically declined in recent years, causing a nearly $11 billion loss in much-needed tax revenue in just one year, according to a bombshell new analysis.
The study released Monday by the Citizen Budget Commisison comes amid fears that socialist Mayor Zohran Mamdani’s push to “tax the rich” will drive even more wealthy taxpayers and their businesses out of New York City.
Even before Mamdani took office, the Empire State’s share of the nation’s millionaires dipped from 12.7% to 8.7% between 2010 and 2022 – the largest decline of any state, according to the CBC’s Competitive NYS: Value Proposition Tracker dashboard.
“New York’s declining share of high-income taxpayers has meaningful consequences,” the analysis states.
“Had New York maintained its share of the nation’s millionaires over the past decade, personal income tax collections would have been substantially higher – roughly $10.7 billion more in tax year 2022.”
Many experts and business leaders warned Mamdani’s stick-it-to-the-rich policy dreams – and their growing success among Albany lawmakers – could supercharge the drip-drip of wealthy people.
Gov. Kathy Hochul has firmly opposed an outright hike on the wealthy this year — as she seeks re-election in November — but backed a so-called pied-à-terre tax on luxury second homes in New York City.
Mamdani gleefully gloated about the tax in a social media video filmed outside billionaire Ken Griffin’s $238 million Manhattan penthouse – a stunt that infuriated the hedge fund titan and prompted him to threaten pulling a $6 billion Park Avenue development.
The feud fueled fears of a wider exodus from New York, where the Big Apple’s and the state’s bloated budgets are increasingly dependent on a shrinking sliver of taxpayers.
“In New York, the top 1% of earners pay about 45% of all state income taxes in any given year, so New York’s revenue is very reliant on high earners to stay in New York, and that has been a challenge in recent years,” said Jared Walczak, an economist and senior fellow at the Tax Foundation think tank.
“Gracie Mansion can’t do it on its own; it takes Albany,” he told The Post. “Pied-à-terre will have some impact, but there’s this feeling that New York isn’t done raising taxes, and with other places being more competitive, it won’t be surprising if high-earner taxpayers choose to relocate.”
The Empire State currently ranks dead last for competitiveness, said Abir Mandel, senior state policy analyst with the Tax Foundation.
Mandel argued high taxes drive businesses away to friendlier states, noting Elon Musk moved his companies from California to Texas to avoid the levies.
“Without reforming the tax structure New York won’t be competitive for attracting population and business,” he said.
“Wall Street is the golden goose. But for how long?”
State elected officials backed policies going back to 2010 that many experts argue have driven up costs and further pressured the tax base – such as former Gov. Andrew Cuomo hiking income taxes on high earners during the coronavirus pandemic and Hochul presiding over a Medicaid spending expected to reach $58 billion by the end of the decade.
Ken Girardin, research fellow at the Manhattan Institute, a conservative public policy think tank, pointed at the state’s tightened rent control law approved in 2019 and it’s green energy mandate as a one-two punch that reduced housing supply and raised energy costs.
“Albany is directly responsible for the stagnation,” he said.
The CBC study provides an at-times disquieting snapshot of stagnation gripping the Empire State for years before the young socialist took office.
The findings show:
- New York has lost more population to every state than it has gained from them, with Florida and Texas among the biggest recipients of former New Yorkers.
- After seeing a mass exodus during the coronavirus pandemic, New York City’s population rebound in 2023 and 2024 was driven by international immigrants.
- A “growth corridor” from New York City and Long Island to Albany largely drives the state’s economy, with upstate and other rural regions hemorrhaging workers.
- The Empire State leads the nation in state and local taxes collected, with per capita collections at $12,495 – or 78% above the US average.
New York also had the second-largest share of the nation’s millionaires – 12.7% – in 2010, according to the analysis.
By 2022, the state actually had roughly more 34,000 millionaires, but other states far outpaced that growth, according to the study.
“New York’s number of millionaires doubled, but it tripled in California and Texas and quadrupled in Florida, leaving New York State with the fourth-most millionaires behind those states,” the study states.
New York City fared overall better than regions such as the North Country and Southern Tier – which saw consistent population declines, according to the study.
“It’s difficult to not be alarmed by this data,” said Justin Wilcox, Executive Director, Upstate United. “With this CBC tool, Upstate New Yorkers can see for themselves the devastating impacts of Albany’s policies — businesses failing to grow, population decline, and the loss of revenue. NYS needs to course correct now before it’s too late and we become permanently entrenched in a cycle of fewer people
Mamdani, when asked about the study Monday during an unrelated event, argued fears that the rich will flee are overblown.
He said New York had more millionaires after Albany’s past tax increases.
“I’ve been very clear about the fact that we live in the wealthiest city in the wealthiest country in the history of the world, and it’s unacceptable that one in four New Yorkers are living in poverty, and I believe that the wealthiest can do a little bit more to ensure that everyone can afford to live here,” he said.
But Steve Fulop, CEO of the Partnership for New York City, contended that poor residents ultimately will be the ones to pay the price if the wealthy leave.
“If we don’t course-correct and get laser-focused on keeping the city and state attractive to the people and businesses that drive our economy, the affordability crisis will only deepen because the people leaving are the ones paying the largest share of a budget that funds the social programs meant to help our most vulnerable,” he said.
– Additional reporting by Matthew Fischetti
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