Tired of high taxes? Maybe it's time to move

CNBC data analysis shows outbound flow from high-tax states.

Everyone complains about taxes. But millions of American households apparently are doing something about it: Picking up and moving.

A CNBC analysis of tax data and figures provided by two major national moving companies shows that states with the highest per-capita taxes, for the most part, are also seeing the biggest net migration out of those states.

Read More Why your state may be forced to raise your taxes

Take Connecticut, for example.

Earlier this week, the Nutmeg State's legislature approved a collection of new taxes to close a two-year, $40 billion budget to help pay the multibillion-dollar tab to repair and replace the state's dilapidated roads and bridges. The package includes a 50-cent-per-pack hike in cigarette taxes and a bump in tax rates on corporations and the state's wealthiest earners.

The budget battle drew heated debate, along with threats from large employers like General Electric, which issued a rare statement that it might consider moving its Fairfield headquarters.

Republican opponents warned that the tax hikes would likely drive residents to flee to lower-tax states. One legislator suggested that a local moving-and-storage company up for sale should do a booming business moving households from the state.

"I think the best buy in Connecticut right now is a business for sale in Westport," Michael A. McLachlan, R-Danbury, told the AP earlier this month as the debate wore on. "For $650,000, a sharp investor can get up and increase this business into a mega moving company, because that's what people are going to be doing, starting today."

Via: CNBC

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CALIFORNIA: Special Tax Sessions Announced by Gov. Brown

In announcing the budget deal with the Legislature, Governor Jerry Brown announced two special sessions to deal with transportation and Medi-Cal funding. Call them the Special Tax Sessions.

In the press release announcing the sessions, the governor stated that the sessions were to “find more adequate funding for our roads and health care programs.”

The governor asked for “permanent and sustainable funding to maintain and repair the state’s transportation and critical infrastructure.” He also wants “permanent and sustainable funding to provide at least $1.1 billion annually to stabilize the state’s General Fund costs for Medi-Cal,” some of which would be used to meet the demands of programs Democratic legislators sought funds for in the current budget such as In-Home Supportive Services.

At the governor’s press conference announcing the budget deal, reporters asked Brown about his first term (third term?) campaign pledge to only seek tax increases with approval of voters. Brown brushed aside the old pledge indicating the pledge only applied to his first term.

Add it all up and there will be a push for tax or fee increases to support the governor’s call for “permanent and sustainable funding.” Discussions will revolve around gas taxes and a higher car tax or maybe a mileage fee for transportation; perhaps an increased cigarette tax and other healthcare taxes for Medi-Cal.

Brown might hope for support from the business community for the transportation and infrastructure fix. Those issues have been of on-going concern to business.

Via: California Political Review

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California: Attack on Prop 13 Faces Long Odds

The original Proposition 13 was four paragraphs long fitting on one side of a piece of paper. SCA 5, the measure to change Proposition 13 introduced by Senators Loni Hancock and Holly Mitchell yesterday intended to increase taxes on business property is 30 pages long. Without going into the details of the proposed changes, suffice it to say the groups behind the proposal, liberal organizations and public employee unions, want more tax dollars to spend. That is despite the fact that the state treasury is enjoying a big boost in revenue.

The rhetoric of “fairness” spoken by supporters at the press conference announcing the bill does not match the impact of what the proposed law intends to do. Sen. Mitchell said at the press conference, “What we are looking to do is to take those few that are benefitting from under-assessment and bring them in line with everyone else.” 

The measure would not raise taxes on a “few” but re-assess all business property annually so that they can pay the highest property tax possible.

Most of the news reports following the press conference that announced the filing of the bill spoke of “long odds” and “high hurdles” to get the bill through the legislature. Since the proposal is a constitutional amendment, it requires a two thirds vote to be placed on the ballot. Many news articles noted that there are no Republican votes for the measure.

A more interesting question is how many Democratic legislators will vote for SCA 5? I can imagine right now there are a number of political consultants drawing up campaign mailers that say: Candidate X voted to change Proposition 13.

While there seems little expectation that this proposal will get through the legislature, it is anticipated that a split roll could become an initiative measure.

The recent PPIC poll question on a split roll found only 50-percent of the voters support the idea. That mark was recorded against a simple question asking if commercial property should pay taxes based on full market value. There were no arguments offered to the respondents about possible consequences such as thousands of lost jobs, a stifling of economic growth, and devaluation of commercial property when new property taxes are capitalized into the value of the property.

A multi-million dollar campaign pointing out the negative consequences of a split roll is sure to take shape if the split roll makes the ballot.

Via: California Political Review

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$132 Billion in New Taxes/Fees Proposed by CA Legislators … So Far

As the Legislature nears the June 15 deadline for sending a budget bill to the governor, the California Taxpayers Association released “Tax Watch,” a report detailing $132 billion in new taxes and fees that have been introduced by lawmakers so far during this legislative session.

The report includes every bill introduced so far this session that would impose or authorize higher taxes, fees or tax-like “fees” estimated by state officials to generate $5 million or more per year in net revenue.

State revenue increased more than $10 billion this year under our existing tax structure, but that hasn’t stopped some lawmakers from asking for even more. With tax revenue surpassing expectations, and the state’s rainy day fund now in place to help weather future storms, this is not the time to be proposing $132 billion in new tax and fee increases. 

The most expensive proposal for taxpayers is Senate Bill 8 (Hertzberg), which would extend the sales and use tax to cover services (including veterinary services, auto repairs, gardening and music lessons).

The State Board of Equalization, which administers the sales and use tax, estimates that this change alone would cost taxpayers $122.6 billion every year, on top of all existing taxes.

To prepare “Tax Watch,” CalTax reviewed every bill introduced or amended from December 1, 2014, to May 29, 2015. In cases where two or more bills proposed similar increases (for example, four bills proposed taxes on marijuana), the cost was counted only once for purposes of calculating the total amount of taxes and fees proposed during this session.

Teresa Casazza is president of the California Taxpayers’ Association

Via: California Political Review

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Meet Martin O'Malley

The RNC would like to introduce Martin O’Malley, the tax-hiking, anti-energy production Governor who's best known for his disastrous state ObamaCare exchange and his legacy on crime and jails in the city of Baltimore that have come under fire. A prolific tax raiser, O’Malley increased taxes 40 times on Maryland families, including an absurd “flush tax” on household water and sewage usage. With a record like that, it’s no wonder why even voters in the blue state of Maryland rejected his legacy and elected a Republican last year.  


Via: RNC.com

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Who actually pays their “fair share” of taxes?

In recent years, claims that “the rich” don’t pay their “fair share” of taxes have been repeated countless times. But that excuse to tax them more to line others’ pockets is blown away whenever the highly disproportionate income tax burdens borne by higher earners are reported. As the Wall Street Journal titled a recent article,“Top 20% of Earners Pay 84% of Income Tax.” In fact, the top 1 percent of American earners earn about one-sixth of total income, but pay nearly as much in income taxes as everyone else combined.

Rather than abandon the electorally valuable false premise that such disproportionate burdens are justified, however, the political Left rallies to its cause. They try to rescue it by asserting that other taxes are regressive, so that taxes aren’t “really” so clearly unjustifiable as income tax burdens reveal. The featured players in that drama are state and local sales and excise taxes and Social Security taxes. Unfortunately, those taxes are also misrepresented to defend “fair share” misrepresentations.

Columnist Michael Hiltzik illustrated the state and local gambit in a tax-day column echoing charges that their sales and excise taxes “disproportionately hammer lower-income taxpayers,” with that alleged regressivity offsetting income tax unfairness.

That claim arises because those with lower current measured incomes spend a larger proportion of them on those taxes. However, as Edgar Browning has noted, “relative to lifetime income, there is very little difference in the percentage of income consumed among income classes.” As a result, apparent regressivity using current incomes is shown instead as “roughly proportional” to income in the more-appropriate lifetime context. Low current-income families also consume a multiple of their income, largely financed with government transfer payments excluded from income measures. That further exaggerates the share of their incomes going to such taxes.

Via: California Political Review

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New Study: Proposed tax on services could costs Californians $122.6 BILLION per year

Just in time for Tax Day, the Board of Equalization issued a study requested by the Senate Committee on Governance and Finance estimating the revenue take from taxing untaxed services would be $122.6 billion. The study will become fodder in the coming debate over Senator Bob Hertzberg’s effort to restructure the state tax system to include taxes on the service economy.

Just in time for Tax Day, the Board of Equalization issued a study requested by the Senate Committee on Governance and Finance estimating the revenue take from taxing untaxed services would be $122.6 billion. The study will become fodder in the coming debate over Senator Bob Hertzberg’s effort to restructure the state tax system to include taxes on the service economy

.Hertzberg commented on the study results, “California’s economy has changed from one that had been dominated by making goods to today where 80 percent is producing services.”

Hertzberg’s plan, Senate Bill 8, would tax services as part of a restructuring plan and raise an additional $10 billion in tax revenue.

In response to the study, Board of Equalization Vice-Chair George Runner said,  “I’d consider a broader sales tax only if it’s part of revenue neutral tax reform, such as abolishing California’s income tax and the Franchise Tax Board, along with other taxes that destroy jobs. … The last thing overtaxed Californians need is another tax.”

Runner opposes Hertzberg’s proposal.

There will be plenty of time to get into the debate over service taxes. However, it should be noted that the $122.6 billion the service tax could supposedly raise is not only larger than the current General Fund budget of $113 billion, but almost $10 billion larger. In other words, a tax on services as outlined in the study could replace the General Fund revenues and get the additional $10 billion that Hertzberg is looking for while eliminating the income tax, state sales tax and corporate tax.

Hertzberg’s proposal would not attach a service tax to all the items delineated in the BOE study, pointing out education and health care as tax-free services.

If not all services are taxed the door would be open for other services and industries to seek exemptions from the tax — a potential field day for the state’s lobbyists.

Via: California Political Review

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Tax Revenues Hit Record in First 5 Months of FY14; 5-Month Deficit Still $377B

(CNSNews.com) - Inflation-adjusted federal tax revenues hit a record $1,104,947,000,000 in the first five months of fiscal 2014, but the federal government still ran a $377,379,000,000 deficit during that time, according to the Monthly Treasury Statement for February.

Each month, the Treasury publishes the government’s “total receipts,” including all revenue from individual income taxes, corporate income taxes, social insurance and retirement taxes (including Social Security and Medicare taxes), unemployment insurance taxes, excise taxes, estate and gift taxes, customs duties, and “miscellaneous receipts.”

In constant 2014 dollars, the $1,104,947,000,000 that the federal government collected from October through February in fiscal 2014 was $90,193,750,000 more than the $1,014,753,250,000 it collected in October through February in fiscal 2013.

After the current fiscal year, the second highest federal tax intake in the first five months of a fiscal year occurred in the first five months of fiscal 2007, when the government collected $1,076,721,860,000 in 2014 dollars—or $28,225,140,000 less than in the first five months of this fiscal year.

Via: CNS News

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SCOTT WALKER RESPONDS TO ATTACKS BY CUTTING TAXES, AGAIN

By: Grover Norquist
2/21/2014 10:15 AM

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The establishment press first went for New Jersey Governor Chris Christie’s throat. The attacks may not be fatal, but they put Christie off his game and delayed and maybe ended his opportunity to become the prohibitive favorite for the 2016 Republican nomination.

Now they are coming for Wisconsin Governor Scott Walker.

This week all the Republican governors are meeting in Washington D.C. for the Republican Governors Association annual meeting. But it might be best understood as the first caucus—two years before Iowa. Christie, Walker, Bobby Jindal, Rick Perry, Sam Brownback and Mike Pence are all governors who could credibly run for President based on their policy and political successes in their respective states.

So how is Scott Walker responding to the establishment left’s coming attacks?

He is cutting taxes in Wisconsin. Again.

Walker announced a series of tax cuts totaling more than $800 million in this year’s budget: a $406 million cut in property taxes and $100 million in lower income taxes. The property tax cut will save the average homeowner $100 over last year. The personal income tax will be cut by reducing the lowest income tax bracket from 4.4 percent to 4.0 percent. Every family will receive a tax cut of about $58 per year.

In addition, the state will reduce its withholding tax for state income taxes saving taxpayers $322.6 million each year. This will save the average family of four about $58 each month.

Via: Human Events

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Achieve Olympic Glory - Now Pay the IRS

As 230 U.S. Olympic athletes gear up to compete in the 2014 Winter Games, the only thing colder than the slopes at Sochi is the fact that any prizes awarded by the U.S. Olympic Commission (USOC) will be taxed by the IRS. Many Americans don't realize that the U.S. taxes income earned abroad, and as such even the winnings of Olympic athletes are subject to the reach of the IRS.

The USOC awards prizes to U.S. Olympic medal winners: $25,000 for gold, $15,000 for silver, and $10,000 for bronze. Relative to each athlete's income tax bracket, some top earners such as Shaun White could end up paying over a third (39.6 percent) of their winnings to the IRS. 

Additionally, because the U.S. is one of only a handful of developed countries that tax income earned abroad, it is likely America's competitors will not be subject to such a tax. Taken together - the tax on Olympic athletes and the tax on income earned abroad - it can be said the U.S. has officially "earned the Gold" for having one of the most backwards and illogical tax codes in the world. 

U.S. Tax Rates per Bracket	Max. Tax Liability on Gold Medal Prize of $25,000	Max. Tax Liability on Silver Medal Prize of $15,000	Max. Tax Liability on Bronze Medal Prize of $10,000
39.6%	$9,900	$5,940	$3,960
35%	$8,750	$5,250	$3,500
33%	$8,250	$4,950	$3,300
28%	$7,000	$4,200	$2,800
25%	$6,250	$3,750	$2,500
15%	$3,750	$2,250	$1,500
10%	$2,500	$1,500	$1,000

Americans for Tax Reform has calculated the federal income tax medal winners could potentially face.  It will vary depending on which marginal income tax bracket the athlete finds himself in for 2014. The amounts below represent only the federal income tax liability, and do not account for income taxes owed in most states.

 For gold medal winners, ATR believes applying the top marginal income tax bracket of 39.6 percent to gold medal winners is reasonable for the following reasons:

• Gold medal winners (as opposed to silver and bronze medal winners) are likely to have marketing, endorsement, speaking, etc. deals in 2014, and should have higher-than-usual earnings
• 
  
• Because state income taxes are not being calculated, there is a margin of error built into the methodology

Via: Americans for Tax Reform
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