UK Reality Check – Is Gov Brown Listening?
02/22/2012 3 Comments
Governor Brown’s Tax Initiative includes a provision to raise the personal income taxes on the wealthy. While this provision was found to be popular with the general public by the California Public Policy Institute, it may not be popular with California millionaires.
The UK government passed a surtax on high-income earners, raising the tax to 50%, which too effect at the beginning of the year. It was expected to raise a billion pounds a month. How did that work out? Tax revenue dropped by more than £500 million pounds.
It turns out that the wealthy in the UK are finding ways to shelter their income when the government drove the cost of taxes high enough to make it worthwhile. Does Governor Brown thinking the California’s high-earners and millionaires are dumber than those in the UK and they will just accept his new taxes without seeking to shelter there wealth? If he does, he is stupider than I thought.
Not only will the state lose tax revenue, but it could also loose access to the personal wealth of California’s millionaires that could be invested to spur local economic growth. I wonder if our Governor will take note of the lessons being played out in the UK? I doubt it, he is a liberal Democrat.