Are you thinking that it’s time to do the Depardieu—time to take your money and citizenship to some place more hospitable—Russia perhaps, or maybe Texas?
Just as Vladimir Putin courted Gerard Depardieu, who had been shopping for a new homeland ever since France's Socialist government proposed slapping a 75 percent tax rate on the movie star’s fortune, Texas Gov. Rick Perry this week has been peddling the low-regulation, tax-free virtues of Texas to Californians. In response, Gov. Jerry Brown abandoned his Latin to call Perry’s pitch a “fart.”
But does the Lone Star campaign represent more than a passing gust of unpleasantness in the state's otherwise improving economic atmosphere? While Perry is chiefly wooing CEOs, the Contra Costa Times published an article Friday pointing to anecdotal evidence suggesting that rich Californians have had enough. The Times quoted a realtor in Lake Tahoe and a “business relocation specialist” in Irvine, both said that large numbers of people are taking their money across the state line. Or at least want to.
"I'm hearing more angst from these people and a desire to get out faster than I'm normally accustomed to hearing," the relocation specialist told the Times.
According to these sources, Prop 30, which increased the maximum state income tax rate by three percent for seven years, is the culprit. To be sure, California’s millionaires pay a lot to the government, almost 52 percent in state and federal taxes. That’s more than any other state and the highest combined rate in California since WWII, according to the New York Times.
The New York Times makes a more sober assessment of the possibility of mass millionaire migration. An article on Wednesday found plenty of disgruntled rich Californians, but none who were packing their suitcases.
What do you think? Are you a business owner or high income individual thinking about leaving California? Have you investigated any of the options that allow you to remain in the Golden State while your money lives somewhere else?