Taxes aren’t going to make the rich leave California, report says


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Millionaires aren’t likely to leave California if taxes are increased, according to new research from the Stanford Center on Poverty and Inequality.

The research, which was presented in Sacramento on Monday, comes just two weeks before voters will decide whether to raise taxes on the rich. Conservatives have routinely warned that wealth will leave the state if taxes are increased.


The report examines whether or not wealthy residents left the state after a tax increase in 2005, which increased taxes on income over $1 million by one percentage point in order to fund mental healthcare.

“The highest-income Californians were less likely to leave the state after the millionaire tax was passed,” said the report.

The research was hailed by the California Budget Project, a left-leaning think tank in Sacramento. Chris Hoene, the organization’s executive director, said it “dispels one of the most persistent myths about state tax policy.” Gov. Jerry Brown has asked voters to raise taxes with Proposition 30, which would increase levies on individual income over $250,000 a year by one to three percentage points. It would also hike the sales tax by a quarter cent.

Jon Coupal, a leading anti-tax advocate and president of the Howard Jarvis Taxpayers Assn., said the new research “runs contrary to everything else we’ve seen.” He pointed to a September report from the Manhattan Institute, a conservative think tank, that says more people are leaving California than moving here.

“Most of the destination states favored by Californians have lower taxes,” the report said.



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Photo: Pasadena residents prepare for a move to Las Vegas in 2004. Credit: Luis Sinco / Los Angeles Times