I’m a fifth generation Californian. When I was a kid it was the greatest state in the union and became the 8th largest economy in the world. Everyone wanted to come here. And the the Democrats took over and its becoming Michigan.
California’s income tax, which is the tax many small-business owners pay, is the nation’s third highest; the 9.3% rate kicks in at $46,349 in annual income for those who file as individuals, and the 10.3% rate applies to income over $1 million a year.
Then there’s the highest sales tax (7.25%, plus local levies in some areas) in the country, the fourth-highest capital gains tax (9.3%) and the second-highest gasoline tax (an average of 65 cents a gallon).
There’s also the vicious regulatory environment that businesses have to negotiate.
“California’s anti-business climate is worse than ever because many politicians are making a career out of treating businesses as an object of scorn vs. a resource to be appreciated,” says Joe Vranich, an Orange County relocation expert who tracks business movement out of the state and provided the exit numbers cited above.
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“Hence, we see efforts to increase taxes, regulations, fines and fees on businesses.”
The benefit of leaving California is immense. Vranich says businesses save 20% to 40% a year in costs after their out-of-state moves are completed.
Businesses are fleeing the state in droves and with them goes jobs and tax revenue. The current governor Jerry Brown is a typical Democrat. He thinks the solution to everything is more taxes.
When statists take over, states fail. Bureaucracies are cancers. They grow exponentially and destroy the very thing they are supposed to serve. California is the most bureaucratic state. Its legislature is made up mostly of no-so-crypto-marxists who think capitalism is bad and big government is good. We’ve seen how well this worked out for Russia, China and blue states like Michigan which was once, believe it or not, a wealthy magnet state.
But like the Eagles sang: “Call some place paradise, kiss it goodbye.”