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It still wouldn't make any sense including sales tax. The effect of sales tax on total tax burden scales even less linearly than the steeply progressive CA inco
by vsef 6y ago
It still wouldn't make any sense including sales tax. The effect of sales tax on total tax burden scales even less linearly than the steeply progressive CA income tax rates! The more you earn, the smaller % of your income goes to things that are sales taxed.
The income tax scale in CA is steeply progressive, a 50k earner pays only 3.8%, less than almost all states that have flat income tax. For a median earner, CA is in the upper half but not exceptionally high:
https://wallethub.com/edu/states-with-highest-lowest-tax-burden/20494/ https://wallethub.com/edu/states-with-highest-lowest-tax-bur...
Having been in very high income brackets myself, lived in both low and high col areas/states, and run this calculation often, I think taxes is largely a red herring. The difference made by tax is just peanuts compared to the impact of housing cost, which truly is very high in CA. For low income brackets, CA is frequently lower tax burden than elsewhere, but housing cost will destroy you. For very high income brackets you do start to see the difference in marginal tax rate, but your absolute income is so much higher that you aren't spending a significant % on sales tax, and those marginal differences aren't driving your decision making anymore.