Have we? California's marginal tax rate is over 50%, higher than many European countries. The Internet suggests that someone making $260,000 (200,000 pounds) will pay about 41.5% of their income in taxes in the U.K. https://www.thesalarycalculator.co.uk/salary.php. Using a similar tax calculator for California suggests that they'd pay about 39%. I assume the U.K. is also in a post-Reagan, post-tax world?
Must be Reagan. Couldn't be total mismanagement at all levels of California government.
Is that really true? This official calculator [1] says I'd have to pay only 16k on 200k income.
And this source [2] says income tax tops out at 13.3%.
[1] = https://webapp.ftb.ca.gov/TaxCalc/Home/Results
[2] = https://www.communitytax.com/state-taxes/california-taxes/
Tax is comparable to Europe and yet services are not. The problem is therefore the government.
Top federal rate is 37%, top state rate is 13.3%. Total top marginal rate is 50.3%.
The figure I cited above is from a tax calculator that I’ve found to be pretty accurate. Note that the various deductions are much less valuable for high income earners under Trump’s new tax plan due to the limit on SALT deductions. Finally, while the calculator I used excludes US credits for healthcare, children, etc., the calculator I used for the U.K. also does that. The hypothetical is basically a single Google programmer who rents and has no kids.
CA's top marginal tax rate is 12.3%. If it were >50% no rich person would live in the state.
The combined state and federal rate is not >50% either, and any calculator that claims otherwise is lying. And that's before you even take deductions into account.
If you're paying >50% marginal tax rate in CA, your accountant should be fired. And possibly investigated for embezzling funds from you in the form of "tax payments."
As to the combined marginal rate, it’s 50.75% on labor income above $576,000 (12.3% state, 37% federal, 1.45% Medicare). Then there is a 1% surcharge on incomes over $1 million. I’m not sure why you’re talking about dedications because that won’t affect the top marginal rate.
Why are you so confident here? The top CA marginal rate is 13.3%. Top federal marginal rate is 37%. Medicare tax is 1.45%. simple addition gives a top marginal rate for wage income of 51.75%. I have no idea how your accountant can get that lower.
And then you find that your tax burden in Texas ends up being close to the same as it was in California, but your taxes in Texas don't get you any public services.
That 2.5% extra in the UK (so about £5k/$8k a year) includes free healthcare too (plus at £200k you'd almost certainly be in a job that also has excellent private health care for you and your family with no extra payments as well as the free NHS). I understand that this can cost many tens of thousand in the US even before you use it.
I just don't get the US system sometimes I really don't. Perhaps instead of calling for SV companies to move elsewhere in the US, why not just come to London or Zurich or Berlin?
The combined state and federal marginal tax rate does not exceed 50% either.
Medicare adds another 1.45% as well.
It is not. The top tax bracket (income $1m+) is 13.3%[1]. Where are you getting this number from?
2. It's slightly disingenuous to call it "California's marginal tax rate" when 2/3 of that figure comes from federal taxes. It's like saying "Texas's marginal tax rate is 37%".
3. The SALT deduction changes have made it so that residents of states with high taxes are effectively double-taxed. California isn't responsible for this state of affairs.
Perhaps, you meant, we've given up on the ability of government to use those taxes for the greater good. I'd agree with that. for the last 50 years, If even a tiny fraction of those taxes were used to solve all the zoning and building regulations, we'd be in great shape right now.
Only the homes that have been sold in the last ~5 years are actually paying 1% of property value in yearly taxes. Many homes are paying much, much less because they haven't been sold in 20 years and/or were passed down within the family. Or, the owners move out and rent the home and continue to get artificially low property taxes (while increasing rent higher and higher reach year).
You could say california has given up on building cities.
Within 10 blocks of where I live more than 30,000 new units are being constructed (or have finished construction) in a 3 year window.
That doesn't include the dozen residential buildings of 100+ units I see on my daily commute, or the other dozens of buildings being built along public transportation routes in LA.
Long Beach and San Diego have also experienced residential building sprees.
The problem is that California is such a desirable place to live that even with all the undesirables leaving the state for the South, we still can't keep up with the growing demand for new housing.
This WSJ piece is instructive. Tokyo has seen flat housing prices despite population growth. The secret? Tokyo had a lot more housing starts than NYC or SF.
Yes, california attracts new people. A sensible housing market would build more houses to build them. It is not clear how higher taxes would help, unless you think higher japanese tax rates cause their private sector to build more.
https://mobile.twitter.com/wsj/status/1113274956765331456?la...