From the Home News Tribune:
Fanklin resident Jim Morano and his wife recently acquired a home in South Carolina after his wife’s sister and mother passed away.
The couple plans on keeping the home as a winter getaway, but they’re also wondering whether it should be their permanent residence because of New Jersey’s income-tax rates, among the highest in the nation. Both own small businesses.
“We’re kind of scratching our head,” said Morano, who has a Ph.D. in food science and a master’s degree in business administration. “If you already own a residence outside of New Jersey, at some point in time, the differential is going to pay you to leave.”
Adam Shapiro and Suzanne Hayes work out of Weidel Realtors’ Lambertville-New Hope, Pa. office. Shapiro knows firsthand about the moves across the river, since his and Hayes’ office in Lambertville moved to New Hope this year, leaving a kiosk in Lambertville.
“It’s a big issue, a major issue,” Shapiro said. “Property taxes are much lower in (Pennsylvania) than in New Jersey. I would say that of the people I have sold houses to that lived in New Jersey and moved to (Pennsylvania), at least 50 percent was due to the higher tax rates in Jersey and lower insurance rates in (Pennsylvania), including auto insurance.”
The state saw a deceleration of population growth starting in 2002 and a sharp acceleration in the number of residents moving to other states, according to a 2007 study by James W. Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University; Joseph J. Seneca, a professor at the Bloustein School; and Research Associate Will Irving.
Because of the overall net outflow of people since the start of the decade, New Jersey’s aggregate adjusted gross income was reduced by $7.9 billion in 2005, and the total annual state tax loss that year approached $539 million, according to the report.
Hughes said the bursting of the housing bubble slowed moves nationwide, but out migration from New Jersey has continued at a muted pace.
Hughes said the high cost of living here is a key reason why people are leaving. For example, while the median household income in New Jersey is 33 percent higher than the rest of the nation, the state’s median housing cost, including property taxes, is 56 percent higher, Hughes said.