Bad News for Newsom: California Exodus Results in $340 Million Tax Revenue Loss Amid $32 Billion Deficit: Study
As Democrat-dominated California struggles to maintain its declining population, a new study revealed that the state has lost more tax income revenue from migration than any other state.
Conducted by the real estate platform MyEListing.com, the study found that California lost approximately $343.2 million in tax income because of migration out of state in 2021. Deep blue New York came in second with a net loss of $299.6 million and Democrat-run Illinois was third with $141.7 million.
The U.S. Census Bureau reflects this mass exodus, showing that an estimated 343,000 Californians moved out between July 2021 and July 2022, and only 125,000 people moved in, according to KTLA-5.
Los Angeles County suffered the largest population loss with a decline of over 90,000.
Overall, the state’s population has declined by about 500,000 since 2020, KTLA-5 reported.
Going flat: California population projected to stagnate through 2060 https://t.co/23y1ZmrU3L
— O.C. Register (@ocregister) July 27, 2023
California’s tax income loss was notably caused by high-income earners seeking a better bang for their buck in states that offer lower taxes and a lower cost of living.
“Despite its numerous attractions, from the booming tech industry and world-class universities to beautiful landscapes and cultural richness, California’s high personal income tax rates seem discouraging for many high-wealth individuals,” the MyEListing study found, warning that if this trend continues, it could fuel a “wealth migration” out of California.
The fact that all of this is coming at a time when California lawmakers have approved a budget with a $32 billion budget deficit, according to The Associated Press — after years of surpluses — just highlights how bad the situation is.
That isn’t going to look good on the resume — or potential campaign literature — of California Gov. Gavin Newsom, a man who’s long been eyeing a run for the White House.
Unsurprisingly, Florida was the top destination for such individuals, with the state gaining a whopping $12.4 billion in tax income from migration – $3.5 billion of this coming from former California residents, according to Florida’s Voice, a conservative news site in the Sunshine State.
Florida’s Voice cited a report by the Florida Chamber of Commerce.
More than 50% of the total net income migration into Florida is from the following top five states:
1) New York – $9.8 billion
2) Illinois – $3.9 billion
3) New Jersey – $3.8 billion
4) California – $3.5 billion
5) Pennsylvania – $1.9 billionhttps://t.co/H0f1CQ5fh1— Christian Ziegler 🇺🇸 (@ChrisMZiegler) July 24, 2023
Texas and Arizona followed close behind at $10.7 billion and $9.4 billion, respectively.
Florida, as the study noted, has become a hotspot for “individuals and families with substantial income and assets”
“High-income earners are increasingly choosing the Sunshine State, reflecting an age-old economic axiom: Money goes where it is treated best.”
If Texas and California had a child, it would be Florida.
With California’s weather and beaches, and Texas’s business and tax-friendly climate, it attracts more billionaire residents and tourists than anywhere else.
How is Florida not universally recognized as the best state? pic.twitter.com/h6dyR32vhT
— SMB Attorney (@SMB_Attorney) July 29, 2023
In terms of population growth, Florida also ranks first. Over 674,000 people moved to Florida from another state in 2021 and 469,000 residents left, resulting in a net growth of 205,163 residents, according to Census Bureau data examined by the publication Insider, which embarrassed itself earlier this month by pretty much getting the facts exactly opposite.
“Happy Days” actor Scott Baio was one such California resident to move to Florida. After residing in California for 45 years, he ultimately jumped ship over growing crime rates and an uncontrolled homeless population.
Another notable name who joined the migration out of California is Tesla CEO Elon Musk, who caused quite a stir last year when he moved the company’s headquarters from California to Texas.
Chevron made a similar move last year, selling around 90 of its San Ramon offices so that it could build up its operations in Houston.
Meanwhile, the loss of such companies will make it even harder for California to pay off their $32 billion deficit.
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