alt Hacker NewsI don't buy it, we don't really see it on a smaller scale now despite the same incentives being in place on a smaller scale, in fact it is rare enough to warrant fearmongering news stories when it does happen and PR statements. Nobodies moving out of high tax countries to go live in Somalia without taxes. And if they do leave, then who is to say they can even maintain the same business relationship to the US? They either pay the taxes because the US taxes citizens even outside the US, or if they abandon their citizenship to avoid it then they become subject to the same costs and fines and restrictions as any other foreign persons and businesses.
I really don't really see much of any chance for downsides to 99.9% of the population, but plenty of upsides. If the only thing maintaining the US economy is a a small percentage of rich people sitting on stacks of capital, the US economy is already doomed and the people on top are just trying to be the last ones down into the water.
We do see it though. But usually they hide the income overseas because that's more straightforward or cheaper or whatever. However there are several small island countries that are known for hosting ultra wealthy expats on very favorable terms. This isn't some hypothetical.
In the business world how many companies are just coincidentally booking all their revenue in Ireland?
I'm really not clear what point you're trying to argue here. Someone upthread suggested that a sense of community would prevent the disproportionately wealthy from relocating to nearby states to avoid higher taxes. I call bullshit, dependent on the size of the relative tax gap. They don't even have to sell their house, just purchase a second one and reside there more of the year.