During the recent campaign, Gov. Jerry Brown insisted that people would not try to avoid his Proposition 30 tax increase by halting investments and “hiding” their money. Prop 30 boosts the top state income tax rate on millionaires to 13.3 percent from 10.3 percent.
Warren Buffett just wrote the same thing in a New York Times op-ed, insisting that the wealthy don’t react when their taxes go up. “So let’s forget about the rich and ultrarich going on strike and stuffing their ample funds under their mattresses if — gasp — capital gains rates and ordinary income rates are increased,” he wrote. “The ultrarich, including me, will forever pursue investment opportunities.”
The evidence, including Buffett’s own investment history, indicate otherwise.