The absurdist playwright Eugène Ionesco wrote Exit the King. It stands out in Ionesco’s canon as a play whose plot is straightforward and focuses on depletion rather than accumulation.
In that sense it resembles the proposed billionaire tax that has made its way onto the California ballot this November. We have been following the proposed tax and its federal counterpart in several posts on Power Line (with more to come).
California billionaires have already paid exorbitant taxes on their wealth as they earned it. Because it would be retroactive to January 1 if adopted in November — but see the Tax Foundation’s “Mid-Year Movers and the Califorania Wealth Tax” for possible wrinkles — the flight of the California billionaires has already begun.
Today the California Post editorial board addresses the flight of Califorania billionaires to avoid the new tax:
California’s proposed “billionaire tax” will be collected by the Franchise Tax Board if it passes in November. But it should really be run by the US Fish and Wildlife Service, because it looks like a hunting license — targeting the billionaires who have left the state.
The California Post reported Wednesday that the state intends to go after wealthy taxpayers who left the state to avoid the possibility of having to give up 5% of their wealth.
Three wealthy individuals in particular are thought to be in the state’s crosshairs: White House adviser David Sacks, Uber co-founder Travis Kalanick, and Google co-founder Sergey Brin.
All are great innovators. All three left California, as they stand to lose potentially hundreds of millions of dollars. Yet all could face deep audits by the state to determine whether they can somehow be declared California residents.
You can be sure that the state taxman will find any excuse to declare these individuals to be California residents. Cash-hungry California is already seen as one of the most aggressive states when it comes to residency.
As the Eagles sang: “You can check out any time you like / But you can never leave.” Not when it’s the Hotel California.
We should be making it easier for wealthy people to stay in California — not because they are forced to do so, but because they want to do so.
Their wealth would be far more productive if it were invested to grow California’s economy than if it simply passed through the fingers of government bureaucrats.
You can be sure that the state taxman will find any excuse to declare these individuals to be California residents. Cash-hungry California is already seen as one of the most aggressive states when it comes to residency.
Think of all the businesses that these wealthy investors could start; think of all the jobs they could create.
Instead, California has chased them away. And now California wants their money, so it can pay for public health care whose costs are out of control.
The citation of “Hotel California” has become all but obligatory in commentary on the tax. However, what happens in California doesn’t stay in California. As the editorial notes: “If Gavin Newsom has his way, it will not matter what state California’s billionaires flee to, because the wealth tax would apply throughout the country.”
