Archive for the ‘California’ Category

California braces for outbound migration of fat cats…

January 23, 2018

Loss of SALT deduction may be the straw that breaks the camel’s back.

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Last week, we reported some moving data from United Van Lines that indicated “moving deficits” in high tax & spend states: Illinois, New York, New Jersey, Connecticut, Massachusetts.

See Northeast states continue to experience a “moving deficit”…

We expressed surprise that California was rated as “neutral” not “outbound”.

Well, according to the Sacramento Bee, it’s just a matter of time.

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Even Gov. Jerry Brown has observed: ““People with higher incomes will pay a lot taxes (when SALT taxes deductions are cut), and some of them may be tempted to leave.”

That’s a problem because “The state’s wealthiest 1% pay 48 percent of its income tax, and the departure of just a few families could lead to a noticeable hit to state general fund revenue.”

In the past, California passed tax increases with impunity, assuming that “elites are embedded in the regions (like California) where they achieve success, and they have limited interest in moving to procure tax advantages.”

Now, that’s not a certainty, and the state is considering some very creative (and, somewhat laughable) ways to offset the likely drop in individual tax receipts ….

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