- A report from Bloomberg found that the top 1% of New Yorkers had a combined $US133.3 billion in income in 2018, and paid 42.5% of the city’s total income tax.
- That means just 0.46% of the city’s population accounted for a whopping $US4.9 billion in tax revenues that year.
- Obviously, those wealthy New Yorkers leaving could be a major blow to the city’s economy – and the number of ultrawealthy city residents may have already shrunk due to the pandemic.
- Per Bloomberg, one thing keeping the wealthy in the city is access to schooling and education.
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A new report from Bloomberg found that the top 1% of New Yorkers paid $US4.9 billion in income taxes in 2018 â€” 42.5% of all the income tax collected by the city that year, according to new data from New York’s Independent Budget Office.
That $US4.9 billion came from only 38,700 New Yorkers â€” around 0.46% of the city’s total population.
Overall, those ultrawealthy New Yorkers accounted for $US133.3 billion in income. In 2018, the median income in New York City was $US63,799.
That number may already be a high-water mark for the city, as New York City saw residents’ wealth drop across the board in 2020, its number of millionaires and billionaires decrease, and many New Yorkers moving out, at least temporarily, as Business Insider reported in March. While some have since returned, others have permanently relocated.
Wealthy New Yorkers fleeing could be a major blow to the city’s economy
Early in the pandemic, when New York emerged as the epicentre of the pandemic, The city tracked garbage pickups and trash loads in different neighbourhoods and found reductions in more affluent neighbourhoods â€” including the East Village, the Upper West Side, and the Upper East Side. The amount of waste actually increased in parts of Queens and Staten Island, implying the wealthy parts of the city emptied out and the less affluent parts may have swelled in number.
The amount of income and capital the ultrawealthy hold in New York is staggering: Per Bloomberg, the top 5% of taxpayers in 2018 earned more than the bottom 95%.
As Kevin Baker, the author of “The Fall of a Great American City: New York and the Urban Crisis of Affluence,” wrote in the Atlantic: “The more New York has allowed working people and small businesses to be driven out of the city, the more it has come to depend on the very wealthiest â€” people and firms with the wherewithal to move if they don’t get the subsidy or tax break they demand.”
The knock-on effects of this migration are already obvious, especially in real estate. Amid the pandemic, apartment sales in the city have plunged, while real-estate agents in neighbouring suburbs have found themselves in the midst of a buying frenzy.
One major draw reportedly keeping the wealthy in the city is education
Per Bloomberg, the number of ultrawealthy children in the city “has grown sharply” over the last decade. In 2018, there were 31,137 children of tax filers who earn over $US1 million. Those families may remain in the city and take advantage of its myriad schools.
However, some ultrawealthy residents had already found workarounds for schools in the city. In May, Business Insider’s Taylor Nicole Rogers reported that the wealthy were hiring private homeschool teachers, while over the summer, pandemic pods began to pop up, prompting concerns over access to equal schooling across different income brackets.
New York City private schools have felt the impact of more affluent residents fleeing. The New York Times’ Paul Sullivan reports that private schools in the New York metropolitan area saw a 56% drop in enrollment, while 36% of schools in the Northeast saw enrollment increase.
Private schools in Connecticut and New Jersey saw enrollment increase, and Jay Lasley, an admissions director in Florida, told Sullivan that he “fielded a surge in calls from parents in Chicago and New York.”
As Business Insider’s Katie Warren reported, some schools have been meeting parents where they are, with one elite private school opening a “flex” campus in the Hamptons.
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