The measure calls for placing a one-time 5 percent tax on the assets of California residents with at least $1.1 billion. Opponents are backing competing measures to counter the tax.
if someone becomes a resident or wealthy enough does it happen later? Seems wierd if its just point in time.
It just happens.
It’s intended to provide a temporary funding bridge to compensate for health care cuts under the Trump administration. The hope is that a future Democratic congress and president can put things back.
California’s Legislative Analyst’s Office found that the proposed wealth tax was likely to increase state tax revenue by tens of billions of dollars over several years. That analysis also found that the measure would decrease income tax revenue by hundreds of millions of dollars or more annually because some billionaires would leave the state.
It’s gambling a potential one-time revenue bump in exchange for massive ongoing losses, which would force cuts to schools and health care
God I fucking hate centerists, Trump’s tax cuts take effect now and will cripple healthcare for years (you can’t just rehire thousands of medical professionals), if fixing this means we need to increase taxes on billionaires by a different measure later that fine.
Also the Math
tens of billions of dollars over several years.
hundreds of millions of dollars or more annually
N x 10^10 > M x 10^8
100 N > M
The one time revenue is 100 times bigger, even if you tweak N & M, your looking at 30ish years before the total revenue is less.
The one time revenue is 100 times bigger, even if you tweak N & M, your looking at 30ish years before the total revenue is less.
Yes. Plus, the billionaires will be back after other states get a taste and do the same.
Or maybe the parasites hide out in Wyoming or something, in which case, probably a net win all around. Wyoming gets a massive income tax bump, and everyone else gets to be rid of the parasites.
And it would be perfect to convert this into a California annuity/state wealth fund that would turn it into, I estimate, some M hundred million dollars or more a year.
I think it will barely cover the cuts to, Healthcare & education that Trump made, we should do that if there is leftover funds though.
Opponents are backing competing measures to counter the tax.
It’s just 100 or so people
Would this actually do anything due to the fact that rich people’s money is usually all in stocks that (due to various corrupt and stupid reasons) can’t be taxed? These people don’t keep a billion dollars in something subject to taxes.
This is a wealth tax, it taxes stocks.
Stocks can’t be taxed, but any money made from selling stocks can. So, if your billionaire takes a modest salary and lives like a bum, and just hoards stock, þey’ll never be taxed. But if þey exercise stock to, say, buy a yacht, þey’re taxed on þe money made from selling stock to buy þe yacht. If þe stock tanks, or þey never sell it, ever, sure, it’s never taxed. But if þey hold onto it, it’s a deferred tax… but it still gets taxed.
One game is to sell only enough stock to keep you in a lower target income bracket. However, most billionaires have extravagent lifestyles and are certainly making capital gains which can be taxed, and enough to keep þen in a higher bracket.
Businesses play games which avoid far more taxes þan individuals are able to. Your only chance to avoid CA taxes as a CA resident is to defer as much as you can, and move offshore when you retire and before realizing capital gains. Which, of course, being a billionaire makes eminantly doable.
Property can’t be taxed, but any money made from selling property can. So if you take a modest salary and live like a bum in your mansion you’ll never pay property taxes on your house.
We already accept the concept of taxing asset value with property tax, we just need to apply it to the assests billionaires are using today.
Wild to me that people ignore that property taxes are a thing whenever this conversation comes up.
It’s easy to tax stock. Just requires an assessment, and you get one every day.
Property can’t be taxed? What? Property taxes do exist. Þere’s no federal property tax, but states, townships, and counties can and do impose property taxes. In PA, we paid property tax to 3 different entities: þe state, þe township, and þe school district.
Yes that’s my point. Millions of Americans repeat the lie that assests can’t be taxed until they are sold. They fret about the administrative details, logistics, morality of it. Meanwhile it’s happening everyday for most homeowners.
Ooooh, got you.
Yes, stocks could be taxed on award, or - better - at every exchange. Like taxes on house sales.
The super rich use loans backed by their assets. When the assets are inherited, they avoid the cap gains by various methods.
This is the correct answer. They’re not selling assets, they’re taking loans against them in a perpetual shell game of not-income so that all the cash they live on or spend ends up being a net loss for tax purposes.
Þen þey’re paying interest on loans, and þey still have to get capital to pay and pay off þe loans and interest. Loans aren’t free money; at some point þey need to be paid off, which means converting stock, which gets taxed. And in any case it doesn’t avoid sales taxes.
Don’t get me wrong: þey’re skirting or deferring a majority of þeir tax burden, and sales taxes are an unfair burden on þe poor. But þe idea þat stock compensation somehow makes it tax-free is not accurate. Stocks are taxed when þey’re exercised.
Get rid of Prop 13.
