Leave it to California to bite the hands that feed it. Or in the Golden State’s case, run the wealthy who carry the vast majority of the state’s tax burden to greener pastures elsewhere.
It’s not like the mass exodus is not already happening. The 2020 census resulted in California actually losing a congressional seat for the first time since statehood was achieved. In 1850.
Now Democratic leaders are scheming ways to squeeze even more money out of those who already fill the state coffers. That is, of course, those who have not already packed up and left the state due to violent crime, lagging school performance, and exorbitant taxes.
But that’s not all. Lawmakers are even working on ways to get tax revenues from those who leave.
Remember also that there are calls for making $5 million payments to persons as reparations for slavery, guaranteed income programs, and the list goes on.
A wealth tax would only increase CA’s dependence on the minute number of people who are bearing the burden of supporting CA’s spending. We’ve already lost many of these folks — who have taken their biz, investments and jobs to other states @JimWunderman https://t.co/a5Vu7oABh4
— Bay Area Council (@BayAreaCouncil) January 20, 2023
Now there’s the new wealth tax proposal. Introduced into the legislature on Tuesday, the proposal differs from the current income tax in that it is based on everything you own, not your annual income.
Its targets may make the measure attractive, at least at first glance. Only those who have a global net worth exceeding $1 billion, or $500 million for married taxpayers filing separately, will be affected. Initially.
In order to escape its clutches, all a person must do is give up their California residency. Many in the upper tiers of society have already done so, considering the state income tax rate tops out at 13%. So what’s to stop more residents from throwing in the towel and heading elsewhere?
Not a thing.
There is already a line heading out of the state filled with middle-class residents who are being priced out of existence. Between the cost of living and tax rates, there are much more attractive options to be found elsewhere.
Then there’s the segment of the population that foots the lion’s share of the state’s funding.
According to demographer Wendell Cox, the highest income sector of the population bears the brunt of taxation. How much? A miniscule 0.5% of taxpayers generate 40% of the state’s revenue.
How much more attractive would a state such as Texas, which does not levy an income tax, be for those squeezed out of the Golden State? And California can hardly afford to lose any more high earners with the radical proposals that continue to bounce around the Capitol.