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Stanford economists warn California billionaire tax could cost state $39 billion

By PulseAugur Editorial · [1 sources] ·

Stanford economists Benjamin Jaros and Joshua Rauh have warned that California's proposed Proposition 40, a one-time 5% tax on billionaires, could result in a net loss for the state. Their analysis, published by the National Bureau of Economic Research, estimates the tax would collect approximately $30 billion, significantly less than the $100 billion proponents anticipate. The primary reason for this discrepancy is the potential for billionaires to relocate, which the economists project could lead to annual income tax revenue losses of $1 billion to $3.5 billion, ultimately outweighing the one-time tax proceeds. AI

RANK_REASON The cluster discusses a significant policy proposal with substantial economic implications for a major state, including analysis from academic economists and counterarguments from proponents. [lever_c_demoted from significant: ic=1 ai=0.1]

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Stanford economists warn California billionaire tax could cost state $39 billion

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COVERAGE [1]

  1. Fortune TIER_1 English(EN) · Bilin Lin ·

    Billionaires fleeing California could turn a $30 billion tax windfall into a $39 billion loss, Stanford economists warn

    Departures have already erased nearly 30% of Prop 40’s tax base, a new NBER paper estimates. The tax’s architects say the math assumes losses that won’t last.

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