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I don't think this is accurate. The "no income tax, high sales tax" tax structure in TN/FL/TX/etc is intended to make sure poor people are paying high tax rates

I don't think this is accurate. The "no income tax, high sales tax" tax structure in TN/FL/TX/etc is intended to make sure poor people are paying high tax rates even when they aren't making much money. Thus somebody who makes less (and is forced to spend most of their money buying basic "things" needed to get by) will spend a higher percentage of their overall earnings on taxes than in states with lower sales tax. In regressive tax states, tax revenue "per capita" may be lower (because you're leaving a lot of money on the table - you're letting the rich take home more) and you've de-facto shifted the tax burden to people who have less money to begin with. So a large percentage of the population ends up paying more in taxes - the people who make less and use most of their income for purchases - while the high income earners pay less. You simultaneously reduce the money available for government programs while penalizing the people who need those programs more. Note: people on HN are likely to be the "high income" earners who benefit from such a tax regime. If you're looking to work remotely and are optimizing to this level - i.e., you are seeking out regressive tax regions so you can pocket more money - you might want to consider whether this is a moral choice you actually feel comfortable with.

tristor 4y ago
If your point (and the article's point) is that sales taxes are regressive and that moving from California where Prop 13 locks your property tax rate to a new state with high property taxes is effectively regressive, I guess... okay. That's not really news to anyone or surprising. If you were not in California or Texas, but had to pick one to move to, you'd be better off moving to Texas at any income level at or above the federal median income. While the property tax rates are lower in California and can be locked in with Prop 13, the house prices are massively higher. You can buy a nice home in Texas for $250k in most of the state (not in Austin), and that same house in California would be minimum $1M. A smaller percentage of a significantly higher valuation is still a boatload of money. Also, you are making a bunch of conclusions not in evidence. The evidence, at least for Texas, shows that the majority of tax revenue comes from high income earners, primarily because they're land owners who buy more expensive/larger properties and because they make larger purchases. The state gets its income from property tax and sales tax primarily, both of which are considered "regressive taxes". While you're correct that these taxes account for a larger percentage of income for someone with lower income, the net effect is that the majority of the tax burden is being paid by more wealthy residents. Generally the right thing to do for people in lower income brackets in states without income tax is to increase their income, since they aren't penalized for it. In other states, you get penalized for increasing income, and in many cases are completely out of reach of ever having property ownership. Average people own homes in Texas, average people in California rent forever. Ultimately, I suppose it's a good thing for these sorts of analysis to occur because it's more information to consider, but I do think there's some insidiousness to the way this is framed both in the article and in many of the comments. I don't even live in Texas anymore, but I definitely don't want to see it Californiated. If you want to live in California and think it's a better deal, go live in California, don't demand that Texas matches the same tax regime.

tristor 4y ago

If your point (and the article's point) is that sales taxes are regressive and that moving from California where Prop 13 locks your property tax rate to a new state with high property taxes is effectively regressive, I guess... okay. That's not really news to anyone or surprising. If you were not in California or Texas, but had to pick one to move to, you'd be better off moving to Texas at any income level at or above the federal median income. While the property tax rates are lower in California and can be locked in with Prop 13, the house prices are massively higher. You can buy a nice home in Texas for $250k in most of the state (not in Austin), and that same house in California would be minimum $1M. A smaller percentage of a significantly higher valuation is still a boatload of money. Also, you are making a bunch of conclusions not in evidence. The evidence, at least for Texas, shows that the majority of tax revenue comes from high income earners, primarily because they're land owners who buy more expensive/larger properties and because they make larger purchases. The state gets its income from property tax and sales tax primarily, both of which are considered "regressive taxes". While you're correct that these taxes account for a larger percentage of income for someone with lower income, the net effect is that the majority of the tax burden is being paid by more wealthy residents. Generally the right thing to do for people in lower income brackets in states without income tax is to increase their income, since they aren't penalized for it. In other states, you get penalized for increasing income, and in many cases are completely out of reach of ever having property ownership. Average people own homes in Texas, average people in California rent forever. Ultimately, I suppose it's a good thing for these sorts of analysis to occur because it's more information to consider, but I do think there's some insidiousness to the way this is framed both in the article and in many of the comments. I don't even live in Texas anymore, but I definitely don't want to see it Californiated. If you want to live in California and think it's a better deal, go live in California, don't demand that Texas matches the same tax regime.