John Gilburn

European countries are now aggressively wooing high-earning expats with special tax breaks. The Wall Street Journal recently reported on the sweetheart deals, which mimic the generous corporate welfare that New Jersey’s state government showers upon wealthy companies like Amazon and well-connected industries like nuclear power.

Many countries exempt significant portions of expats’ income — anywhere from 30 to 50 percent — from income taxes. Some countries have thrown in a few extras, like deductions for furnishing and decorating a new home or children’s tuition costs.

Discriminatory tax policies that favor the rich are surprising for historically high-tax countries like Italy and France that have long made a sport out of squeezing the well-off.

Take for example the 75 percent “super tax” French President François Hollande sought to impose on the country’s highest earners back in 2012. Not surprisingly, the well-off quickly looked for an exit. The wealthiest Frenchman, Bernard Arnault, applied for Belgian nationality. Gérard Depardieu, one of the world’s bestl-known French actors, actually became a Russian citizen. And the country’s professional soccer players were up in arms. Current French President Emmanuel Macron quipped at the time that it was “like Cuba without the sun.”

The 75 percent tax was struck down by the court before it went into effect and a 50 percent employer tax took its place. That tax, which was scrapped altogether after 2014, brought in little additional revenue and the country’s budget deficit skyrocketed.

And now times have changed. Countries from the Mediterranean to the North Sea are attempting to lure the wealthy and their accompanying investment and job creation —although one wonders how long hardworking taxpayers in these countries will put up with the special tax treatment for rich expats.

Lawmakers in Trenton currently debating a costly new “millionaires tax” should learn from Europe’s expat tax break fad: don’t drive out high-earning taxpayers in the first place.

New Jersey legislators have already created the worst business tax climate in the country. Hardworking taxpayers here face among the most burdensome income, sales and gas taxes and our property taxes are the highest nationwide.

People — from the wealthy to those of more modest means — are fleeing our state in droves. From 2010 through last year, we have been one of the few states with outbound migration, according to the U.S. Census Bureau. And for years United Van Lines has listed us as one of the top outbound states.

Lawmakers have burdened New Jersey taxpayers to the breaking point and still can’t pay the bills.

New Jersey is the nation’s least fiscally sound state, according to a 2017 study that analyzed states based on five categories: cash on hand to cover short term bills; fiscal year budget solvency; longer-term spending commitments and risks; the ability to increase spending if citizens demand more services; and unfunded pension and health care liabilities. The researchers concluded that “New Jersey’s metrics are dire,” and pointed to “a heavy reliance on debt and large unfunded obligations.”

New Jersey doesn’t tax too little, it simply spends too much. Higher taxes on top earners won’t fix our funding problems. And by driving even more taxpayers out of our state, it could make them worse.

If we head further down this high-tax path, what crazy tax break scheme will New Jersey have to come up with to lure employers and workers back to our state?

John Gilburn is the owner of a security company. He lives in Manalapan.