I spend a lot of time comparing California's tax and regulatory climate with other states. The reason is simple -- people are reluctant to leave a country (especially the United States), but they WILL leave a state. And so will businesses.
The news is not good. Consider:
* California has the third worst state income tax in the nation.
* By far the highest state sales tax rate in the nation.
* California corporate income tax rate is the highest west of the Mississippi (our economic competitors) except for Alaska.
* Fourth highest capital gains tax.
* Highest total gasoline and diesel taxes in the nation.
* California is ranked 27th worst in per capita property taxes (including commercial) -- the only area where we are not in the worst 10 states. But CA property taxes per home were the 10th highest in the nation in 2008.
* One of the highest state vehicle license car taxes -- raised 77 percent higher since 2008.
* California's 2010 "Tax Freedom Day" (the day the average taxpayer stops working for government and starts working for oneself) is the seventh worst date in the nation -- up from 28th worst in 1994, but down from fourth worst last year. CA "improved" only because of our state's soaring unemployment rate (third highest in the nation). Unemployment -- the new tax dodge!
* In 2009, California was responsible for about 42 percent of all the state tax increases in the nation.
* Our 2010 Business Tax Climate ranks 48th in the nation.
* California now has the lowest bond ratings of any state, edging out Louisiana.
* America's top 600 CEO's rank California "the worst place in which to do business" for the fifth straight year.
Here's the bottom line result: Look at California's net domestic migration (migration between states). From April, 2000 through June, 2008, California has lost a NET 1.4 million people. The departures slowed in 2008 only because people couldn't sell their homes.
These are not welfare kings and queens departing. They are the young, the educated, the productive, the ambitious, the wealthy (such as Tiger Woods), and retirees seeking more bang for the buck.
The irony is that a disproportionate number of these seniors are retired state and local government employees fleeing the state that provides them with their opulent pensions -- in order to avoid the high taxes that these same employees pushed so hard through their unions.
Incredibly, the politicians' solution is -- you guessed it -- higher taxes! We are locked in a death spiral. This madness must end now.
NOTE: For a more complete, up-to-date factsheet comparing CA with the other states (including the online sources), go to my blog at RiderBlog.NotLong.com.
Rider is chairman of the San Diego Tax Fighters.