Progressive Taxes Push High‑Earners Out

Updated: 2026.10.10 2H ago 1 sources
California’s combination of very high progressive income taxes and restrictions that concentrate land rents can produce measurable, income‑skewed out‑migration: IRS data (2022–23) show high‑income households leave at much higher net rates than overall migrants. That means tax design and who bears location‑rent capture matter for whether amenity‑rich states retain the people who finance their services. — If progressive tax structures and regulatory capture trigger selective out‑migration, state fiscal and redistribution policies can unintentionally hollow out their high‑tax bases and shift jobs and investment elsewhere.

Sources

California in-migration and out-migration
Tyler Cowen 2026.10.10 100% relevant
The article cites IRS migration data showing 2022–23 outflows exceeded inflows by 40% overall and by 64% for households with incomes ≥$200,000, and points to Proposition 13 and steep progressive income taxation as mechanisms.
← Back to all ideas