On January 12, Issues & Insights posted an article about the reaction to a proposed California tax on billionaires. It should not be a surprise that billionaires do not want to pay this tax.
The article reports:
The Billionaire Tax Act isn’t even officially on the California ballot yet, but that hasn’t stopped businessmen, entrepreneurs, and investors from fleeing the state, taking $1 trillion in wealth – along with jobs and opportunity – with them.
Tech entrepreneur Chamath Palihapitiya has been keeping track of who’s decided to leave the state in advance of this “temporary” tax.
“We had $2T of billionaire wealth just a few weeks ago. Now, 50% of that wealth has left – taking their income tax revenue, sales tax revenue, real estate tax revenue, and all their staffs (and their salaries and income taxes) with them,” he posted on X this weekend.
“In other words, by starting this ill-conceived attempt at an asset tax, the California budget deficit will explode. And we still don’t know if the tax will even make the ballot.”
Among those who’ve given up on California are Google co-founders Sergey Brin and Larry Page. The New York Times reports that 10 days before Christmas, Brin “terminated or moved 15 California limited liability companies that oversee some of his business interests and investments out of the state” and “more than 45 California limited liability companies associated with Mr. Page filed documents last month to either become inactive or move out of the state.”
The Laffer Curve is an illustration of what is happening in California:
Millionaires and billionaires have tax accountants, lawyers, and other people who help them legally avoid many of the taxes the rest of us pay. Voting with your feet is one of the easiest ways to avoid excessive taxes. Voting with your feet is one of the reasons Texas and Florida are the fastest growing states in the nation. Their tax policies make them very attractive to businessmen.
The article concludes:
This is a state, after all, that has managed in the past few years to kill its other golden goose, the film industry – the Wall Street Journal last fall said “L.A.’s Entertainment Economy Is Looking Like a Disaster Movie.”
It’s a state that sits at the top of the list for highest tax rates, but the bottom of the list for just about everything else. (See “Do Californians Realize How Badly They’re Getting Ripped Off?”)
It’s a state that – despite idyllic weather and natural beauty – has driven more than 1.6 million residents away. (See “The Great Divorce Continues.”)
As we noted in this space a couple of weeks ago (See “California’s ‘Get Out Now’ Tax”), “Businesses and people are fleeing because lawmakers and blue voters are stuck in a Bolshevik rut.”
The question is, what will it take to get California’s lawmakers and voters unstuck?





