California Hates Your Freedom So Much They Want To Tax You For Leaving
One-Party Democratic California is so desperate for cash they want to tax people for leaving.
Desperate to stem the stampede of cash cows — affluent residents — out of their state, they are trying to pass an exit tax for households with assets of $50 million or more. Current residents would have to keep paying for years after they have decamped to less hostile states.
Heaven forbid that these legislators should instead come to terms with the reasons so many productive residents flee or what they could do to make their state a more attractive destination for people and businesses. They aren’t much concerned with that, merely with stopping the flight of all that revenue. If they cared about the livelihoods of the people leaving, they probably would have governed in a way that didn’t prompt people to head for the exits.
This is probably unconstitutional nine ways to Sunday. Wealth tax, Ex-Post Facto law, taxation without representation, etc. It’s also likely to be counterproductive, as rich people are not only likely to leave the state preemptively to avoid being subject to it, but are exactly the people that can hire top-notch lawyers to get it overturned.
Louis Rossmann, who recently fled New York City to Austin, has additional thoughts:
“They are showing and demonstrating here they have no confidence in their ability to govern better, or in their ability to actually give the customers of that state what they want, because they’re telling you ‘We’re not going to make things better. Rather, if you leave we are going to figure out a way to fine you.'”
“It demonstrates a sick ideology that’s both just authoritarian and disgusting in nature.”
“It’s not like [the tax rates in California and New York] just spiked up insanely over the past one or two years, they’ve been higher than the tax rate in Texas and Florida for as long as I’ve been alive, by a fairly large margin. This is not news. It’s something else in addition to that, and they don’t even appear to be interested in trying to figure out what that is.”
“Florida and Texas…have not had income tax for a very long time.”
“Maybe it would make sense to actually ask people what changed over the past two or three or five years that caused you to decide that you want to move your business and get the fuck out.”
“I could tell you from experience that losing half of your employees, putting all your stuff in a truck, carting it across the country. and spending months putting it all back together is insanely stressful, and not something that I’m going to do so I could save six or eight percent of my income tax.”
“Why are you then going to bake more taxes, and then have a fine for leaving that is then going to discourage anybody else that has the same concern from ever coming to your state thereby ensuring that the population of people that are productive and create value diminishes.”
“The idea of being taxed based on what you are worth at a particular time without actually cashing it out is insane to me.”
Long, correct discussion of why long-term capital gains are taxed at a lower rate snipped. (I doubt many of my readers don’t already understand, or disagree.) Ditto the discussion of how investment creates jobs.
“People deciding to defer their gratification, to decide ‘I will wait for the large payoff 10 to 20 years from now rather than make a decision that results in me getting more money right now,’ and I think that that it should be discussed more often because if it’s not, then we are going to end up with stuff like this.”
He discusses the slippery slope argument: The bill already states the tax will start at billionaires, but then in two years hit people with a net worth of $50 million or more. “Once it gets low enough like once this makes its way off to 10 million or a million, because again this is going to slip.”
And just wait until it hits the net worth not only of individuals, but of businesses.
This is all sooo New York. It’s pragmatic. It’s utilitarian. This is the freaking United States of America! Under the supreme law of the land, the United States Constitution, there are not to be any confiscations of property (wealth is property) by the government (the “takings clause”). Not allowed. It took an amendment to the Constitution to allow taxation of income. End of discussion. The idea under discussion is blatantly, facially, grotesquely unconstitutional.
If going to law school destroys your willingness to just see a simple proposition, and the Constitution is, at its heart, simple propositions, then law school ruined you. If you never had a willingness to just let simple propositions be what they are, you should never have been allowed in to law school.
It’s worth pointing out that California has had a problem with letting taxpayers get away from their tax collectors for decades, and to my uncertain knowledge they’ve been getting away with taxing former residents while defining residency down to maximize their tax base.
I do need to emphasize that this isn’t something I’ve ever felt the need to look into; just pointing out that this is something California is kicking up a notch, not something new, and that I’ve never seen anything about the Feds slapping them down for it.
Funny how socialists always end up needing to put up walls to keep people *in*, isn’t it?
This is all sooo New York. It’s pragmatic. It’s utilitarian. This is the freaking United States of America! Under the supreme law of the land, the United States Constitution, there are not to be any confiscations of property (wealth is property) by the government (the “takings clause”). Not allowed. It took an amendment to the Constitution to allow taxation of income. End of discussion. The idea under discussion is blatantly, facially, grotesquely unconstitutional.
If going to law school destroys your willingness to just see a simple proposition, and the Constitution is, at its heart, simple propositions, then law school ruined you. If you never had a willingness to just let simple propositions be what they are, you should never have been allowed in to law school.
It’s worth pointing out that California has had a problem with letting taxpayers get away from their tax collectors for decades, and to my uncertain knowledge they’ve been getting away with taxing former residents while defining residency down to maximize their tax base.
I do need to emphasize that this isn’t something I’ve ever felt the need to look into; just pointing out that this is something California is kicking up a notch, not something new, and that I’ve never seen anything about the Feds slapping them down for it.