Analysis: Newsom's been obfuscating CA's (pretty dreadful) income tax rates

René Magritte: Son of Man, 1964. Image by Rob Corder.

Gov. Newsom has a habit of repeating the falsehood of California's income tax being lower than Florida's and Texas's; so the Globe's Katy Grimes consulted the Tax Foundation, and sets the facts straight with data-based rankings (sorry, CA's at #1 for tax collections per capita) and a comparative map (still takes #1 with a 13.3% indiv income tax).

Even as California faces a record $68 billion budget deficit – after blowing a supposed $100 billion surplus last year – Gov. Gavin Newsom continues to lie about the state’s income taxes, claiming that they are not the highest in the country. …

California’s overall tax burden on middle – and lower-income folks is higher than Florida’s.

Here is the Tax Foundation’s proof, state by state:

… The Tax Foundation breaks down California’s actual income tax structure:

• California has a graduated state individual income tax, with rates ranging from 1.00 percent to 13.30 percent.

• California has a 8.84 percent corporate income tax rate.

• California has a 7.25 percent state sales tax rate, a max local sales tax rate of 2.50 percent, and an average combined state and local sales tax rate of 8.82 percent.

• California’s tax system ranks 48th overall on our 2024 State Business Tax Climate Index.

The Tax Foundation compares all 50 states on over 40 measures of tax rates, collections, burdens, and more, and reports in its State Tax Collections per Capita, California is number #2, and in its State Individual Income Tax Collections per Capita, California is number #1. They also note that Florida and Texas have no individual income tax, along with Washington state, South Dakota, Wyoming, Tennessee, New Hampshire and Alaska.

In their 2024 State Business Tax Climate:

The 10 lowest-ranked, or worst, states in this year’s Index are:

1. Rhode Island

2. Hawaii

3. Vermont

4. Minnesota

5. Maryland

6. Massachusetts

7. Connecticut

8. California

9. New York

10. New Jersey

Here’s why: “The states in the bottom 10 tend to have a number of afflictions in common: complex, nonneutral taxes with comparatively high rates. New Jersey, for example, is hampered by some of the highest property tax burdens in the country, has the highest-rate corporate income taxes in the country, and has one of the highest-rate individual income taxes. Additionally, the state has a particularly aggressive treatment of international income, levies an inheritance tax, and maintains some of the nation’s worst-structured individual income taxes.”

This article originally appeared in the California Globe. Read the whole thing here.

Related:

• Should it be easier for City/State gov't to access tax revenue?

• High income tax to blame for CA'n business exodus?

• Is money earned more valuable than money given?

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