From KCRA Sacramento:
KCRA 3 has learned that 24 chief executives are flying to Phoenix, Ariz., to explore the land of lower taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. es and a much friendlier business environment.
“We can deliver the mayors, we can deliver the CEOs, we can deliver the legislative support,” said Barry Broome, president of the Greater Phoenix Economic Council.
Broome launched his campaign to recruit California CEOs, one day after voters in the Golden State approved Prop 30 last November, and the campaign is working.
Broome said of those, 24 CEOs already have committed to leaving California.
California is a high tax state. They are fourth highest in state-local tax burden as a percentage of state income. The sales tax is the highest state rate in the country, and numerous county rates keep them in the top ten of state-local combined rates. Their individual income tax top rate of 13.3 percent is the highest in the country, with taxpayers paying high rates at even modest income levels. The corporate income taxA corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. is one of the highest in the country. Even the gas tax is the third highest in the country. Only on property taxA property tax is primarily levied on immovable property like land and buildings, as well as on tangible personal property that is movable, like vehicles and equipment. Property taxes are the single largest source of state and local revenue in the U.S. and help fund schools, roads, police, and other services. es is California "low": 15th highest in collections per capita.
The Tax Foundation's annual State Business Tax Climate Index evaluates tax structures for business-friendliness, and the 2013 edition ranked California 48th, or third worst. The individual income taxAn individual income tax (or personal income tax) is levied on the wages, salaries, investments, or other forms of income an individual or household earns. The U.S. imposes a progressive income tax where rates increase with income. The Federal Income Tax was established in 1913 with the ratification of the 16th Amendment. Though barely 100 years old, individual income taxes are the largest source of tax revenue in the U.S. ranked second to last, corporate income tax ranked 45th, and sales taxA sales tax is levied on retail sales of goods and services and, ideally, should apply to all final consumption with few exemptions. Many governments exempt goods like groceries; base broadening, such as including groceries, could keep rates lower. A sales tax should exempt business-to-business transactions which, when taxed, cause tax pyramiding. ranked 40th. (Property tax structure was a bright spot, ranking 17th best in the country.)
Related:
- California Board Takes Back Tax Benefit, Demands Retroactive Payments and Interest
- Fiscal Illusion in California
- Californians Vote on Several Tax-Related Ballot Initiatives
- Governor Brown's Tax Proposal and the Folly of California's Income Tax