Who would have thought?
One thing you can count upon, the mega-wealthy will not pay more in taxes. After watching this game for more than 30 years, this is a reality that everyone has to take notice of.
All those tax increases for the rich? Be serious. They simply move themselves to another state or their holdings offshore. Ultimately, the taxes fall to the middle class.
Joe Rogan made news by leaving the Golden State, home to the largest state income tax in the nation. His new location: The Lone Star. Income tax rate for that state: 0%.
Proposed tax rate for California: 16.8%. Present tax rate: 13.3%.
It seems Joe is not the only one to decide he has enough gold to depart the golden state. We now have Bond King, Jeffrey Gundlach, tweeting the idea.
Rogan signed a reported $100 million contract for his shows. This payout alone would result in a whopping $13.3 million state income tax that Rogan would owe. In Texas, he is in the clear on that money.
We can see even a bigger hit to the state coffers if a guy like Musk leaves. His options with Tesla are worth billions of dollars. The amount of state income tax would be in the hundreds of millions.
Of course, if he follows through on his promise to leave California, no guarantee, then he will save the money especially if he, like Rogan, ends up in Texas.
Years ago, Rush Limbaugh made headlines by taking his fat rear end along with his estimated $34 million salary to West Palm Beach. The state of Florida has no income tax while the state of New York does. Once again, the state lost out on millions of dollars each year.
This is a story that is repeated time and again. Many acts such as the Rolling Stones are known to have saved hundreds in millions in taxes on their royalties by having them in a corporation registered in the Netherlands as opposed to the United States or England.
Of course, the federal income tax was sold to the American public as a "tax on the rich". Over the ensuing decades, we saw the number of people included in it expanding.
Those who cannot move are stuck paying whatever politicians decade. This does not include the wealthy. They have the means to move wherever they desire. It is a situation that is growing easier as we forge deeper into the digital world. Companies as well as individuals no longer require a physical presence in a certain geographic area.
In the end, the system is used by those who can afford to use it.
For the rest of us, we are stuck making up the difference.
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