Taxes on the rich DROP after Prop. 30 tax increase

Nostradamus encyclopedia coverJune 14, 2013

By John Seiler

Call me Nostradamus. I have predicted numerous times on CalWatchDog.com that the Propsition 30 tax increase, combined with President Obama’s national tax increases, would drop tax collections from the rich. That has happened.

Board of Equalization Member George Runner just wrote:

“According to the Franchise Tax Board, the highest 1 percent of income earners will pay more than $2 billion less in 2013 than 2012. That’s not surprising. A recent survey found 75 percent of affluent Californians are planning actions to reduce their tax liabilities—and a quarter are considering moving out-of-state.”

The Prop. 30 tax increase was passed last November, retroactive to 2012. So rich folks got mugged. Most didn’t prepare. But for 2013, they know how hard they are going to be hit with that massive, 13.3 percent state top income tax rate; on top of the confiscatory 39.6 percent Obama federal rate. Total: 52.9 percent.

The rich have had time to take such precautions as sheltering income, or leaving. After Prop. 30 passed, I talked to several who said they were lighting out for Texas or another country. That’s what has happened.

Think of rich people you know.  And think of government tax agents you know, such as IRS people you talk to on the phone. Which is smarter? Case closed.

Remember how Obama and Brown insisted that the rich must “pay their fair share”? The rich agreed — by paying less.

Overall, for the total of all income groups, tax receipts are coming in at $2.1 billion less than last year, mainly the drop in what the wealthy pay.

Yet, the Legislature is going on another spending binge. Why? Basically, because Prop. 30 passed in November 2012, but the windfall of new retroactive tax cash has been collected in 2013. That won’t happen again. Meaning the Legislature well could have a couple of billion less to spend next year.

Here’s the full chart for all income groups from the Franchise Tax Board:

Tax liability franchise tax board, June 14, 2013

 

9 comments

Write a comment
  1. Sean Morham
    Sean Morham 14 June, 2013, 14:56

    Looks like a 2010 predictive model was used. Indicates that the assumptions of the tax increase would have genertated same result, while the campaign to get the tax increase passed was going on. What does this mean? The governor and Senior Gov t folks(those with some degree of smarts)knew this may happen(without compensating economic growth to offset). Next, hold onto your wallets, more tax increases are coming. The electorate may consist of so many mooches, and intellectually challenged, that the tax increases/asset seizures will continue to get passed. Wait till the stock market tanks this fall. Praise the Lord and pass the ammunition( just not to your public safety employees).

    Reply this comment
  2. Tax Target
    Tax Target 14 June, 2013, 16:57

    For those of you making, let’s say $75,000 annually… watch out. You may become wealthy overnight. Comrade Moonbeam will make it so just by declaring that you are wealthy. Nice huh?

    Reply this comment
  3. Byron Baker
    Byron Baker 14 June, 2013, 19:19

    People in the higher end of the tax brackets know that there are legal methods to defer large sums of money from taxes, including the State of CA. There are many options. So, when a new tax arrives, you just defer more income to keep yourself under the radar. I am a native Californian and I can no longer stand the fees, taxes, restrictions, extreme environmentalism and liberal loons. We are moving to the business friendly and tax friendly State of Wyoming. California will have to find other victims to fund their welfare and liberal political programs.Funnel more money into lower income school districts and the teachers pension funds is a debaucle.

    Reply this comment
  4. Tax Target
    Tax Target 15 June, 2013, 07:26

    Byron – Congratulations… I’m moving to Nevada…

    Reply this comment
  5. Ulysses Uhaul
    Ulysses Uhaul 15 June, 2013, 08:02

    Love it…..great for our business….keep up the travel articles…..encourage moving…..we love your business!

    Reply this comment
  6. Ulysses Uhaul
    Ulysses Uhaul 15 June, 2013, 09:03

    Target……take lots of lip balm, repellent, Claritan and body talcam powder…..Nevada is hot, dry and nasty 365 days a year…..sandstorms, grit, searing heat, high energy costs, lots of ball cap and apron jobs or scratchings going the Pennysaver handyman route.

    A living hell with all neighbor-types from the movie RV. Enjoy…..send regards…..we will love your future misery musings!

    Reply this comment
  7. Donkey
    Donkey 15 June, 2013, 20:10

    Wait for Obamacare to kick in and watch the economy tank even more. The leeches of society are bringing the house of straw down, the RAGWUS will be very surprised. 🙂

    Reply this comment
  8. Ulysses Uhaul
    Ulysses Uhaul 16 June, 2013, 21:06

    Bad doom Donkey…..never happy….seem help!

    Reply this comment
  9. Ulysses Uhaul
    Ulysses Uhaul 16 June, 2013, 21:07

    Seek help

    Reply this comment

Write a Comment

Leave a Reply



Related Articles

Detroit sends CA another bankruptcy warning

The Stockton and San Bernardino bankruptcies in 2012 were the largest for cities in American history — until Detroit in 2013.

Teacher Protestors Close Rotunda

Katy Grimes: In an obvious effort to one-up the February Wisconsin state house union protestors, a large, gnarly looking group

Actually, Jerry, Blacks Exiting CA

John Seiler: In an address yesterday to the NAACP, Gov. Jerry Brown contrasted his highly tolerant and politically correct self