Massachusetts Risks $1B in Lost Tax Revenue as Rich Flee

What You Need to Know

If current trenda continue, over 96,000 residents making a combined $19.2 billion in adjusted gross income are set to leave the state yearly by 2030, according to one study.
Last year, Massachusetts lost about 39,000 residents to other states, more than ten times the pace of 2013.
The state recently enacted a 4% surcharge on income over $1 million, which generated about $1.8 billion in revenue over nine months.

Massachusetts stands to lose almost $1 billion in annual revenue by 2030 as high taxes and housing costs push wealthy residents to move elsewhere.

Migration out of Massachusetts to other U.S. states accelerated during the pandemic as the rise of remote work made it more feasible to live farther away from the office.

If the current trend continues, more than 96,000 residents making a combined $19.2 billion in adjusted gross income are set to leave the state annually by 2030, according to a study by Boston University’s Questrom School of Business.

That will cost Massachusetts about $961 million in income tax revenue each year, the study estimates.

Last year, Massachusetts lost about 39,000 residents to other states, more than ten times the pace of 2013, with Florida and New Hampshire among the top destinations.

Prime-age workers have accounted for the majority of the exodus in recent years, with the 26-to-34-year-old cohort seeing the biggest volume of departures, according to the study. More than half of those who are leaving Massachusetts are high earners.

“If our workforce and population is not growing, then we can’t expect to have future economic growth,” Mark Williams, the primary researcher on the study and a lecturer at Boston University, said during a presentation on Tuesday.

What’s Driving Departures?

The persistence of remote work policies — particularly among the knowledge-based industries that dominate in Massachusetts — has made it easier for people to leave, Williams said.

Return to office rates in Boston have lagged the national average, with in-person visits in April still 39% below comparable 2019 levels, according to data from research firm Placer.ai.