Why isn’t California a tax haven?

Aug. 22, 2012

By John Seiler

The Obama campaign is running an ad attacking tax havens, including  Switzerland, Luxembourg, the Cayman Islands and Ireland, for taking Mitt Romney’s money. Although I’m not a Romney fan, I don’t care where he puts his money.

But the question arises: Why isn’t California a tax haven? Why don’t we attract money here because people want us to protect it?

Sure, California has the best venture capital market in the world. That’s great if you’re a 180-IQ computer nerd who needs capital to start up the next Apple.

But what if you’re just an ordinary wealthy person? Why would you put your money here and get it taxed at what could be a 13.3 percent state income tax rate if Gov. Jerry Brown’s Proposition 30 tax increase passes in November? And that’s in addition to what could be a 40 percent federal rate on Jan. 1. Total: 53.3 percent.

Switzerland, in particular, isn’t just a tax haven. It’s medium-sized country with 8 million people. Not all of them are bankers. I fact, the country goes to great lengths to diversify its economy. It is a major industrial producer.

Yet it’s per-capita income is $81,161, the fourth largest in the world, after only tiny Luxembourg and oil-rich Qatar and Norway.

By contrast, the high-tax, high-regulation United States is way down the list, in 14th place, at $48,387. California is about 15 percent higher than the U.S. average, so it’s around $49,112.

Yet, Switzerland boasts excellent roads, schools and other public services that are the envy of the world. Even as California’s schools are abysmal and its infrastructure is crumbling.

How does Switzerland do it? By keeping taxes low, the economy keeps growing. More growth means a broader tax base. And a broader tax base means, in the end, higher tax revenues.

In Switzerland, the top income tax varies by canton, from a low of 13.3 percent in Obwalden, to 29.26 in Geneva. And there’s no capital gains tax, except on real estate in some cantons.

Until Californians realize that we need to sharply cut taxes, not raise them, the state’s economy will continue to decline.

Except for Silicon Valley.

No comments

Write a comment
  1. Queeg
    Queeg 22 August, 2012, 10:11

    The State economy is built to cater to the coastal rich….they shuck a few nuisance bucks to government whose job it is to keep the inland dweller rabble placated!

    Someone gotta do it!

    Reply this comment
  2. jimmydeeoc
    jimmydeeoc 22 August, 2012, 10:22

    Is this the same Queeg we know and “love”?

    You’re absolutely right of course.

    Why the 180?

    Reply this comment
  3. Queeg
    Queeg 22 August, 2012, 12:59

    Queeg is conflicted by the 1% and voodoo economics laughing curving us into the globalists’ abyss….labor exploitation…keep em rags!

    Reply this comment
  4. Donkey
    Donkey 22 August, 2012, 14:45

    Queed fails to notice that the Demonrats implemented NAFTA and MFNTS to China. Clinton and Robert Reich (the Berkeley Leftist) started the globalist ball rolling!! 🙂

    Reply this comment
  5. Donkey
    Donkey 22 August, 2012, 14:47

    John, as long as the RAGWUS controls the politicians California will continue to spiral down the drain at an even greater pace with each passing day. 🙂

    Reply this comment
  6. Queeg
    Queeg 22 August, 2012, 15:30

    Come on Sport. The Republican railroad barons used imported and domestic slave labor, the early part of the industrial revolution had some real Republican slavers too.

    Reply this comment
  7. Donkey
    Donkey 22 August, 2012, 17:38

    Hey sport, the demonrats were the party of actual slavery. It took the Republicans to change that tryst. Nowaday I have no respect for either of the main political parties. 🙂

    Reply this comment

Write a Comment

Leave a Reply

Related Articles

Cap and trade, or tax and raid?

Aug. 28, 2012 Katy Grimes: An auction tax is one of the proposed methods for allocating permits to California businesses and public

Push for sharp minimum-wage hike under way in San Diego

California’s second-largest and the nation’s eighth-largest city appears sure to have a six-month-plus debate over whether to raise the minimum

Silicon Valley’s vanishing middle class

When you read the biographies of Steve Jobs, Steve Wozniak and other early Silicon Valley entrepreneurs, one thing to note