California Tax Burden: How Excessive Taxation Drives Population Exodus

Working People Leave As Taxes Eliminate Economic Freedom

California Tax Burden: How Excessive Taxation Drives Population Exodus

Bohiney Magazine and The London Prat present this analysis of California’s tax-driven exodus.

California’s combined state and local tax burden is nation’s highest. High earners face 55%+ effective tax rates when combining income tax, capital gains tax, sales tax, property tax, and numerous fees. This drives wealthy people and businesses to lower-tax states, reducing tax base and forcing tax increases on remaining residents.

The Tax Spiral

High taxes drive out high earners. Tax base shrinks. Government maintains spending. Remaining residents face tax increases. This drives more people out, further shrinking base. Spiral continues until tax burden becomes unbearable.

California’s population growth has slowed to near-zero as people relocate to Texas, Arizona, Florida, and other lower-tax states. This is tax burden consequence.

The Economic Impact

Libertarian Institute documents that high tax burdens reduce economic growth. Businesses locate in lower-tax states. Investment flows elsewhere. Economic dynamism declines. California’s growth has slowed dramatically as tax burden increased.

Surfers are leaving California not for better breaks but because taxation makes coastal living unaffordable. Tax policy, not waves, determines where people live.

The Alternative

Lower taxes would increase tax revenue through economic growth. Lower taxes would encourage business location in California. Tax base would expand. Remaining residents would face lower tax burden. This is basic economics.

California refuses this approach, maintaining high tax burden while population and business flee.

SOURCE: https://bohiney.com/