A new study that was conducted by an online real estate portal known as MyEListing.com has revealed that California and New York lost more income tax than any other states in the country. One of the main reasons for this decrease in income tax is the mass exodus these states are facing, as swarms of residents from these states have been moving elsewhere seeking more opportunity and less of a tax burden.
Overview
According to the study, the state of California lost a total of $340 million in income tax for tax year 2021. The report goes on to say, “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,” MyEListing wrote in its analysis. “This, coupled with the state’s high cost of living, will likely fuel a wealth migration out of California.” When it comes to the Empire State, New York was right behind California, losing approximately $300 million in income taxes for the same year of 2021. A separate study that was conducted by WalletHub.com revealed that out of all 50 states, New York imposes the most burdening taxes on its citizens.
Where’s Everybody Going?
According to data from the National Association of Realtors, the state of Florida saw the biggest influx of new residents. Last year alone, roughly 320,000 Americans made the move to the sunshine state, coming from places like California and New York. The influx in residents has caused Florida’s tax revenue to increase by $12.4 billion. Another place that saw an increase in residency is Texas. The Lone Star state came in just behind Florida, seeing its tax revenue increase by 10.7 billion due to residents moving in.
Wrap Up
When asked if he was concerned about the mass exodus of his state, California Governor Gavin Newsome said “I love this state, don’t count us out yet.” Despite this optimism, it is no question that California and New York need to do something to address the problem of people leaving. As time goes on, we can only see if these states will put less of a tax burden on their people, or if the people will just continue leaving.