Rich Californians Fear More Taxes After Midterms

Wealthy Californians, who are already paying the highest taxes across America, are likely to face new taxes after the midterm elections.

On the day of voting, Californians will also vote on a ballot initiative that seeks to increase taxes on rich Californians to fund the green energy agenda.

Bad News For Rich Californians

Apart from electing the public representatives on November 8, Californians will also vote on a ballot proposition, namely, proposition 30, the same day.

If the proposition gets passed, wealthy Americans living in the state will be forced to pay new taxes. Reportedly, the new tax collection aims to counter rising wildfires in California and fund electric cars in the state.

Proposition 30 aims to increase tax by 1.75% on people earning $2 million per year. The newly collected tax is expected to increase the revenue of the state government by $5 billion per year.

Many wealthy Californians and Governor Gavin Newsom opposed the proposition.

Reportedly, some corporations will get unnecessary benefits if voters pass the proposition. For instance, ride-sharing company, Lyft, donated $45 million in favor of the proposition before the voting, as the company requires most of its drivers to use electric vehicles after 2030.

Newsom suggested Lyft is backing the proposition to get personal benefits by burdening taxpayers.

Although the proposition is labeled as a climate initiative, Newsom continued, it is specifically introduced to give undue benefit to one company, which is seeking to rob taxpayers for personal gains.

Supporters of proposition 30 claimed the initiative would also help Newsom in promoting his electric vehicles’ agenda, which he is currently pursuing.

California is aiming to ban the production of gas-powered vehicles by 2035, which means new taxes will also help the state government with extending its green agenda.

Californians Already Paying Massive Taxes

Wealthy Californians are already paying the highest amount of taxes in America. If the tax provision passes, the top marginal tax will be increased to 16.15% in the state.

Tax Foundation, a group which promotes low taxes, suggested the new proposition will be equally applicable to both single and married people.

Usually, tax laws provide different brackets for single and married people, but proposition 30 will also be applicable to couples who are making more than $2 million combined.

This new tax provision comes at a time when many business owners are already leaving the state for its draconian tax laws. In 2021, California reported a population shrink of 0.8%, as many people continued to move to red states, particularly to Florida and Texas.

“Elon Musk, Tesla Factory, Fremont (CA, USA)” by Maurizio Pesce

One of the most prominent people who left California for Texas was Elon Musk.

Musk stated he migrated to Texas due to the business over regulation in California. Likewise, the CEO of Oracle, Larry Ellison and co-founder of Dropbox, Drew Houston, also left the blue state.

In case California introduces new tax measures, business activity can nosedive in the state, which could eventually reduce employment opportunities.