I remember playing Sim City about 17 or 18 years ago on a DOS based computer. The concept is pretty simple. You build cities, collect taxes, provide services and hope your cities grow. If you don’t provide enough services like police and fire protection, the people move away and your tax base drops. If you raise taxes too much, folks get pissed and they move away. This last point lost on legislators in Maryland. Obviously they have never played Sim City and, therefore, know less about governing than your average 12 year old kid with a i386, Windows 98 and a floppy disk copy of Sim City 2000.

Here’s a two-minute drill in soak-the-rich economics:

Maryland couldn’t balance its budget last year, so the state tried to close the shortfall by fleecing the wealthy. Politicians in Annapolis created a millionaire tax bracket, raising the top marginal income-tax rate to 6.25%. And because cities such as Baltimore and Bethesda also impose income taxes, the state-local tax rate can go as high as 9.45%. Governor Martin O’Malley, a dedicated class warrior, declared that these richest 0.3% of filers were “willing and able to pay their fair share.” The Baltimore Sun predicted the rich would “grin and bear it.”

One year later, nobody’s grinning. One-third of the millionaires have disappeared from Maryland tax rolls. In 2008 roughly 3,000 million-dollar income tax returns were filed by the end of April. This year there were 2,000, which the state comptroller’s office concedes is a “substantial decline.” On those missing returns, the government collects 6.25% of nothing. Instead of the state coffers gaining the extra $106 million the politicians predicted, millionaires paid $100 million less in taxes than they did last year — even at higher rates.

Will somebody please hire these guys some gamer tax consultants?

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