An article in the Financial Times reports that Blackstone Group chief executive Stephen Schwarzman "spent 200 days last year away from the group's New York base" and is preparing "to spend much of the next six months outside the US, mostly in Paris." The FT chalks this up to "a personal decision, partly influenced by a request by his wife." Maybe so. But, though the FT does not mention it, it's hard not to imagine that tax planning also played a role. Every time some left wing New York City politician suggests increasing city or state taxes on millionaires to increase the city and state tax revenues, they neglect the fact that rich people like Mr. Schwarzman or Julian Robertson are perfectly capable of traveling. Two hundred days is enough to get you past the New York city and state "day-count" test.
New York state imposed a "millionaire's tax" in 2009, raising the state income tax rate to 8.97% from 6.85%. That doesn't include the additional New York City income tax. Rush Limbaugh and Thomas Golisano responded by changing their legal residences to Florida from New York, while the Schwarzmans are Paris-bound. Tax increases in New York are good for Florida and Paris, not so good for New York. It's not as though Mr. Schwarzman is stingy; he gave $100 million to the New York Public Library. But who can blame him if he'd prefer to allocate his capital himself rather than leave it to the notoriously corrupt politicians in Albany to spend what he earned?
