Proposed CA’n “wealth tax” to scare away Silicon Valley billionaires?
CalMatters journalist Dan Walters explains why some Californians are questioning recent statewide efforts to tax (more—or out?) the rich. Considering the extant outmigration problem CA faces, particularly from wealthier residents (many of whom now bring revenue to TX, FL, etc.), is it wise to further tax the remnant that stayed in the Bay?
A phalanx of left-leaning legislators, led by Assemblyman Alex Lee, a San Jose Democrat, introduced the new measures – a bill and a constitutional amendment – as part of a nationwide drive by progressives for wealth taxes in California and other blue states. They hope that imposing wealth taxes at the state level would spur a national tax….
The first question is whether Lee’s new bill has any better chance of winning legislative approval than his previous version, which never got to first base. There are huge Democratic majorities in both legislative houses, far more than two-thirds, but many Democrats are leery of voting for new taxes….
Newsom has hinted that he’s concerned about an exodus of wealthy taxpayers, who already provide a huge share of the state’s revenues. Last year, he opposed a ballot measure, Proposition 30, which would have hiked taxes on millionaires to support efforts to counter climate change.
For the first time, wealthy Californians actively opposed the measure, having remained passive when previous tax-the-rich propositions were placed before voters, and with Newsom’s added opposition, voters rejected it.
Even if the wealth taxes pass the Legislature, voter approval of the constitutional amendment is problematic. With potentially billions of dollars at stake, a lavishly financed opposition campaign is certain, meaning proponents – particularly public employee unions – would have to commit big bucks as well.
This article originally appeared in CalMatters. Read the whole thing here.
This article is part of an Opp Now series on local wealth tax proposals:
The CG’s Chris Micheli reports on California legislators’ proposed raid on taxpayer earnings, euphemistically called a "wealth tax."
The Daily Breeze argues that SJ Assemblymember Alex Lee’s proposed “wealth tax” might prove the last straw for billionaires to U-Haul it to Texas or Florida.
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