The issue has a lot to do with the finances of scale. Mom and pops aren't going anywhere, and neither are you, but Apple will go to Ireland, and wealthy individuals will bank in tax havens. And hence, the wealth gap widens. Most -- the "99%" -- stay and pay taxes. The 1% don't, but they look like they're still here. They just have one foot - the tax paying foot -- in Ireland.
An accountant recently confessed to me that many wealthy Californians do the same using Nevada. Just declare an NV home as your primary residence and make sure to document your time in NV (photos, flights, ATM receipts). CA income tax is 13.3% for the wealthy. NV is 0%.
If you are making let's say 10 mln a year, that means by lying that NV is your primary residence, you did not pay more than 1 mln in taxes. For getting back that kind of money, Criminal Investigation Bureau of Franchise Tax Board can afford keeping dedicated agent who will follow you and see how often do you actually go to NV and after couple weeks of surveillance when he sees that you do not go there much, he can get court order and:
- Look at your cell phone location information for last several months.
- Use Police's license plate trackers to track your car (Probably they do not even need court order for this one).
- They can get your car's location information (I assume high income people have one of modern expensive cars and most of them have tracker in case it is stolen).
- They can talk to your made(s) (I assume you have one, since you make 10+ mln) and pressure them to tell the true story.
Sounds really dangerous to lie about your location now days when it is so easy to check it, without even leaving the room.
