Abstract: This paper explores the migration patterns of California taxpayers and analyzes the potential economic and revenue implications of this movement using the universe of California individual income tax filings from 2000 to 2019. While departure rates have outweighed in-migration rates for most tax brackets over the time period, the highest earners are particularly mobile around tax policy changes such as Proposition 30 in 2012 and the Tax Cut and Jobs Act (TCJA) of 2017. Net outflows of taxable income in the year TCJA was implemented reached $3.8 billion. Taxpayers who would experience a larger increase under TCJA rules due to the limitation of the state and local tax deduction are more likely to leave. High-earning movers have been consistently more likely to leave California for zero-income tax states since 2012.

Read the paper: Taxes and Net Migration in California

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