http://finance.yahoo.com/news/two-tax-rise-tests-wealthy-in-california-214900200.htmlTwo-Tax Rise Tests Wealthy in California2/7/13
PALO ALTO, Calif. — It is getting awfully expensive to be a millionaire in California.
With the new year, big earners are confronting a 51.9 percent federal-state income tax hit on earnings over $1 million, the result of a confluence of new tax-the-rich levies imposed by California and Congress in the closing days of 2012. That is officially the highest in the nation. And at 13.3 percent, the top-tier California income tax is, in addition to being higher than any other state, the steepest it has been since World War II.
Though no one expects traffic jams at 30,000 feet as panicked millionaires make for the state line, the wealthy are once again grumbling about abandoning California for less punishing tax climates. Phil Mickelson, the golfer who collects purses in excess of $1 million, suggested that he might become the latest in a line of athletes and entertainment figures, among them Tiger Woods, who left California for states like Florida, which has no personal income tax.
The Republican governor of Texas, Rick Perry, firing a new shot in an old interstate war, began putting radio advertisements on the air in California this week summoning burdened businesses his way. “I have a message for California business: Come check out Texas,” Mr. Perry said.
Blood, it seems, is in the water.
“Are you looking to leave California because of the recent tax increase?” a CNN Money correspondent posted online in an inquiry this week. “You could be profiled in an upcoming story.”
[More from NYTimes.com: Higher Payroll Tax Pinches Those With the Least to Spare]
For all its many attributes, California has long been a state defined by high taxes and the people who hate them; conservatives here were successfully organizing against taxes before anyone heard of the Tea Party. Yet this milestone — or perhaps millstone — has sneaked up as an unpleasant surprise for the rich, a cloud in the sky at a time when the state budget has come back into balance (in no small part because of the aforementioned tax increase) and the state economy seems to be snapping back to life.
Mr. Mickelson later apologized for discussing the topic, though that did not prevent Mr. Perry from sending him a message on Twitter: “Hey Phil ... Texas is home to liberty and low taxes ... we would love to have you as well!!” Conservatives and antitax activists have cited Mr. Mickelson’s remarks as evidence of what they have long argued are the costs California pays for having such a high tax burden.
“It’s definitely the highest in the United States,” said David Kline, a vice president of the California Taxpayers Association, a taxpayers’ advocacy organization. “What we like to point out to people is that there are states with absolutely no personal income tax — so if you moved from California to Florida, and you are in a high-income bracket, you are automatically giving yourself a 13.3 percent raise.”
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