California on the Brink: 144,000 Pay 50% of Income Taxes

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Imagine the situation in which California finds itself.  Out of all the income taxes collected by that state, 50% of it is paid by by only 144,000 people.  Far less than one percent of the population.  Doug Ross has more on the issue…

California residents already contend with one of the most progressive tax codes in the country. Not only does California have high marginal rates, those high rates kick in at relatively modest income levels. California’s middle class residents earning $48,000 a year, for example, pay a state tax rate of 9.3%. Millionaires in 47 other states don’t even pay that high of a marginal rate. However, one of the state tax code’s greatest flaws is it’s over-reliance on upper income households and the revenue volatility it creates, and that is a problem that Prop. 30 would further exacerbate.

As of 2010, the state relied upon 144,000 households, 1 percent of taxpayers, for 50 percent of total state income tax… [With Proposition 30’s passage,] the top 10 percent of earners would be responsible for over 80% of the projected income generated – a fact that Gov. Brown and other advocates of the bill readily acknowledge.

Um. we’ve documented that businesses, both large and small, are exiting California at an accelerating  rate.  What exactly is California going to do when a large percentage of these people leave?  Where will the money come from then? Or, as Thatcher would suggest, what are they going to do when they run out of other people’s money?

Linked by IOwntheWorld.  Thanks!

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