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Most people radically overestimate California income taxes because they fundamentally fail to understand how progressive taxation works. No one talks about Okla

Most people radically overestimate California income taxes because they fundamentally fail to understand how progressive taxation works. No one talks about Oklahoma having a high income tax, but everyone making under $50k per year would pay more income tax in Oklahoma than California. Quite amazing how that's not "high tax" and perfectly okay. Meanwhile, practically no one in these comments would be exposed to a California 12.3% income tax because it only applies to income above roughly $1.5M/year if married. My income taxes were lower in California than in Iowa at comparable times in my life, yet no one ever used Iowa as an example of high income taxes.

epistasis 2y ago
The biggest "high tax" component of California's system is that capital gains gets taxed as if it were regular income. This was another California Republican idea, namely Reagan's, and I think he implemented it nationally when he was president too. This means that in boom cycles with lots of IPOs and acquisitions, the California state coffers are bulging with money, but in a broad economic downturn there are a few news cycles of "California has a $XYZ billion state budget deficit" before the new budget is set since that deficit is how the new budget is set (no news articles on the balancing, though). There's a big appetite for anti-California news and I have little patience for the assholes who gobble up that misinformation...
dragonwriter 2y ago
> Most people radically overestimate California income taxes because they fundamentally fail to understand how progressive taxation works. Most people radically overestimate California income taxes because of propaganda by the narrow group of people paying top marginal rates directed at the broad group of people who pay closer to the median rate, because the former group wants the latter group to act against its own interests.

epistasis 2y ago

The biggest "high tax" component of California's system is that capital gains gets taxed as if it were regular income. This was another California Republican idea, namely Reagan's, and I think he implemented it nationally when he was president too. This means that in boom cycles with lots of IPOs and acquisitions, the California state coffers are bulging with money, but in a broad economic downturn there are a few news cycles of "California has a $XYZ billion state budget deficit" before the new budget is set since that deficit is how the new budget is set (no news articles on the balancing, though). There's a big appetite for anti-California news and I have little patience for the assholes who gobble up that misinformation...

dragonwriter 2y ago

> Most people radically overestimate California income taxes because they fundamentally fail to understand how progressive taxation works. Most people radically overestimate California income taxes because of propaganda by the narrow group of people paying top marginal rates directed at the broad group of people who pay closer to the median rate, because the former group wants the latter group to act against its own interests.