Propose A Wealth Tax Which Taxes You Even After You Leave The State

Hot Air ^ | Posted at 8:41 pm on August 14, 2020 | JOHN SEXTON

[Hojczyk]

A group of state lawmakers on Thursday proposed a first-in-the-nation state wealth tax that would hit about 30,400 California residents and raise an estimated $7.5 billion for the general fund.

The tax rate would be 0.4% of net worth, excluding directly held real estate, that exceeds $30 million for single and joint filers and $15 million for married filing separately.

California is facing a big budget deficit because of the health and economic crisis brought on by the coronavirus, and “we can’t simply rely on austerity measures,” to close it, said Rob Bonta, D-Oakland, lead author of AB2088. “We must consider revenue generation.”…

People subject to the wealth tax would report it to the Franchise Tax Board along with their income taxes. They would have to report all assets including stock in publicly and privately traded corporations; interests in partnerships, private equity or hedge funds; cash, bonds and savings accounts; mutual funds, futures and options; art and collectibles; offshore financial assets, pension funds, non-mortgage debt, real property and mortgage debt.

To be clear, property would not be considered as part of total wealth because it’s already taxed by property taxes, but they have to report it anyway. UC Berkeley economist Emmanuel Saez co-wrote a paper about the new tax. It makes clear that the wealthy would not be able to flee the state to avoid it because the wealth tax would continue for 10 years after someone leaves the state:

[cranked]

Typical from Cancerfornia......

[Hojczyk]

Coming to all when (if) Biden is elected....bet on it

[dhs12345]

Taxation without representation is tyranny. Can you still vote in your former home state while you are paying taxes?

[neverevergiveup]

It’s just plain old Marxist confiscatory wealth redistribution.

[Old Retired Army Guy]

I can’t believe this would ever pass the Constitutional test. At any rate, how would they enforce it? If a person picked up all their marbles and moved to another State and put their money in an off shore account or something similar, how could California come after it?

[Pearls Before Swine]

A “nose under the tent” proposition. Should this pass, the rate will ratchet up, and the threshhold will be continually lowered. And, many other of the worst and greediest states will copy it.

I wonder why personally held real estate is exempted?

Also, it bears mentioning that we have a related exit tax on the national level. If one renounces citizenship, it is presumed that all of your property that has embedded capital gains is marked to market, and you pay tax on the calculated gain.

Here’s the details for that:

Even after the renunciation, the IRS could still audit and assess taxes and penalties. There is an Exit Tax imposed on people who meet any of the following criteria:

- If your average net annual income tax liability is over $162,000
-If the aggregate net value of your worldwide assets is over $2 million
-If you failed to certify five years of U.S. tax compliance.

What does it mean?

If the Exit Tax applies to you, then you will be treated as if you have sold all of your assets on the day before you renounce your citizenship and will be taxed on your capital gains. It also impacts on the gifts that you present later to U.S. persons, as they will need to pay a tax on them.

[silverleaf]

If they can get away with this, the definition of “ rich” will slide down to snare more and more people, like happened with the AMT

[Bayard]

Cancerfornia will tax the wealth of tourists from out of state next.

[Fiji Hill]

California is facing a big budget deficit because of the health and economic crisis brought on by the coronavirus locking down the economy in overreaction to the coronavifus.

FIFY

[Libloather]

It makes clear that the wealthy would not be able to flee the state to avoid it because the wealth tax would continue for 10 years after someone leaves the state:

Why not 20 years?

[CodeToad]

Already unconstitutional.

[Lurkina.n.Learnin]

They’ll make it generational.

[Hojczyk]

Not if you can find the right Judges

[CodeToad]

It’s why people have finding the right firearms.

[sport]

Now a days being unconstitutional don’t mean shit. Biden’ v.p. choice is unconstitutional but none the less she is his pick.

[KrisKrinkle]

https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200AB2088

It doesn’t appear to be retroactive so eliminating one’s California residency sooner is better than later.

I wrote “eliminating” because the bill contains language regarding part-time and temporary residents.

[TomGuy]

Motto: The more we spend, the more we need.

[jocon307]

So, the time to leave is right now, correct?

[rockinqsranch]

Well, the FIRST THING I see in the article that I know is a lie is as follows from the article: “California is facing a big budget deficit because of the health and economic crisis brought on by the coronavirus,...”

It should read: “California is facing a big budget deficit because of the health and economic crisis brought on by the
Democrats,...”

I quit reading at that point as there was another article on this earlier, and I am burning out on Democraticitis. Need to see a constitutionalist soon, or lose my brain.