Grand Rapids, MI -- (ReleaseWire) -- 05/23/2013 -- Financial advisor Dennis Tubbergen can usually be found helping his own clients. When he has a few free minutes he is busy writing his daily blog, his weekly newsletter Moving Markets or interviewing his next guest expert for his weekly radio show.
Tubbergen's next guest is U.S. Congressman Justin Amash, who reprsents Michigan's Third District. He was elected to his first term on November 2, 2010.
Congressman Amash was born in Grand Rapids and received degrees from the University of Michigan and the University of Michigan Law School. He serves as a member of the Joint Economic Committee and the Committee on Oversight and Government Reform (OGR). His OGR subcommittees include National Security and Government Operations.
The congressman claims to "follow a set of principles. I follow the Constitution. And that's what I base my votes on. Limited government, economic freedom and individual liberty."
Tubbergen, who is an author, radio show host, and CEO of PLP Advisors, LLC, spends a lot of time giving his opinions on the economy in his online financial blog. On May 17, 2013 his blog was titled Another Example of the Relationship Between Tax Policy and Economic Health.
"You need only to look as far as the boxing world to notice the impact that tax policy has on the economy," began Tubbergen. "Boxer Manny Pacquiao has elected to fight his next match in the resort city of Macau, China rather than Las Vegas in order to save about $5.5 million in income taxes."
Below Tubbergen quotes from Americans for Tax Reform.
As reported by Yahoo! Sports, boxing superstar Manny Pacquiao's next fight will take place on November 24; however, for the first time since 2006, the fight will take place outside of the U.S. The official destination of this multimillion dollar sporting event is The Venetian in Macau, China.
As ATR reported in Feruary, the possibility of Pacquiao's next fight not taking place on U.S. soil due to a punitive federal income tax rate of 39.6 percent was greater than most would suspect.
As boxing promoter Bob Arum told Yahoo! Sports in February, "Manny can go back to Las Vegas and make $25 million, but how much of it will he end up with -- $15 million?"
Clearly, the answer is less than what he stands to earn after taxes in Macau.
By holding his next fight in Macau, Pacquiao would only be responsible for a top marginal income tax rate of 12 percent -- that's a whopping 27.6 percent less than the U.S. top marginal federal income tax rate.
As ATR wrote in February:
Since Pacquiao is not a U.S. citizen or permanent resident, he can keep a larger percentage of his fight earnings by taking fights outside of the U.S. The other options Pacquiao and his management team have considered are Macau and Singapore: both casino and gaming markets are comparable to Las Vegas and ideal to host a grand boxing event.
If Pacquiao were to earn a hypothetical $20 million for this upcoming fight in Macau, his after-tax earnings would be $17.6 million -- as opposed to the $12.1 million he would earn for the same proposed scenario in the U.S.
The loss of major athletic and sporting events will have economic repurcussions on the American economy, specifically tourism.
"While I don't know the economic impact that losing this fight will have on Las Vegas, my suspicion is that it's huge," stated Tubbergen. "Far fewer hotel rooms booked, fewer dinners consumed in nice restaurants and fewer cars, limos and taxis rented."
What is Tubbergen's bottom line here?
"This is just one example of how taxes affect behavior," concludes Tubbergen. "It also explains why many affluent citizens are moving from high tax locations like California and New York to lower tax locations such as Florida and Texas."
To read the blog in its entirety go to http://www.dennistubbergen.com and select his May 17, 2013 entry.
Tubbergen’s syndicated radio show can be heard on metro Michigan stations WTKG 1230 AM and WOOD Newsradio1300 AM and 106.9 FM.
About Dennis Tubbergen
Dennis Tubbergen has been in the financial industry for over 25 years and has his corporate offices in Grand Rapids, Michigan. Tubbergen is CEO of PLP Advisors, LLC and has an online blog that can be read at www.dennistubbergen.com. To view Tubbergen’s latest Moving Markets? newsletter, go to www.moving-markets.com.
The opinions expressed herein are those of the writer and not necessarily those of USA Wealth Management, LLC. This update may contain forward-looking statements, including, but not limited to, statements as to future events that involve various risks and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual events or results to differ materially from those that were forecasted. Therefore, no forecast should be construed as a guarantee. Prior to making any investment decision, individuals should consult a professional to determine the risks, costs, benefits and fees associated with a particular investment. Information obtained from third party resources is believed to be reliable but the accuracy cannot be guaranteed.