by Jack Lee
One of the reasons California is facing declining revenues and budget shortfalls is heavy taxation in general and the progressive income tax in particular.
Prior to 2005 taxpayers with income of $500,000 and over accounted for only about 1 percent of returns, but they supported a whopping 39 percent of the tax revenues. The passage of Prop 63 added another 1% of tax liability on incomes above $1 million increasing the burden on the top income earners and increasing the State’s dependency on them for California’s gluttonous cash needs. The top payers have been highly leveraged, but that leverage on the rich can work both ways.
What happens when a few hundred of these top taxpayers have had enough and they move to move tax friendly states? Because the top payers were so disproportionately taxed it has the same effect as losing many tens of thousands lower and middle income taxpayers. A sudden exodus of many top tax payers would be a financial disaster and this is exactly the precarious position your State Legislators have put us in. We can’t keep relying on the rich to pay for everything; we are fast approaching a point of diminishing returns or said another way, the Goose that lays the golden eggs is about to fly the coop. And they won’t take just revenue for the state…they will be taking jobs. Butte County is currently at 13.2% unemployment…we can’t afford to lose more jobs here!
The next time you vote, why don’t you ask the candidate about this and what he or she thinks ought to be the solution? (Hint- cut wasteful and unnecessary spending, remove democrats from office)