"The proposed Billionaire Tax Act, imposing a one-time 5% tax on the total wealth of Californians whose net worth is $1 billion or more, needs reconsideration. Certainly, anyone with $1 billion (or more) has more than enough to live very comfortably, but there is an approach that would be less onerous to the billionaires and more helpful to the state."
"Once again, we hear billionaires are fleeing California because of the possibility of a one-time 5% tax, but billionaires aren't moving to buggy, high-humidity states. They are moving their LLCs to Nevada for more flexible tax planning. Buying a house in Florida doesn't mean moving your life there. It means counting days to be able to pretend you don't reside in California. They pay lawyers and accountants to avoid paying taxes even if paying the taxes would be cheaper. Zero tax is the goal."
The proposed Billionaire Tax Act would impose a one-time 5% levy on Californians with net worth of $1 billion or more. A one-time tax would produce a single windfall for the state and is likely to be spent on short-term, one-off items, yielding no sustained benefit. An annual wealth tax — for example around 0.5% — would generate a steady income stream and avoid a sudden financial jolt to taxpayers. Wealthy residents commonly shift LLCs and legal residency for tax planning, buying homes elsewhere while retaining California ties. Temporary taxes are unlikely to trigger permanent departures.
Read at www.mercurynews.com
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