Big Tech Should Pay Its "Fair Share"... The Best Way Is To Leave California
Authored by Mike Shedlock via MishTalk.com,
My hoot of the day is a Bloomberg Tweet praising San Francisco while asking big technology firms to pay their fair share.
Hoot of the Day
San Francisco lifer @garrytan weighs in on the city’s controversies with @emilychangtv and how tech should pay its “fair share.”
"This is the shining jewel."
— Bloomberg (@business) August 12, 2023
San Francisco lifer @garrytan weighs in on the city’s controversies with @emilychangtv and how tech should pay its “fair share.”
Watch the full episode here: https://t.co/i9oa08FxDf pic.twitter.com/SmZyyYR0Xm
Fair Share
And who is it that gets to decide the definition of “Fair Share”?
If anything, I suspect big tech is paying more than its fair share.
How so? Let’s total it up starting with salaries.
Google Salary Estimates
Google pays its employees well. The median salary is $140,000 a year.
Every Google employee pays taxes at California’s exorbitant rate.
Talent.Com notes “If you make $140,000 a year living in the region of California, USA, you will be taxed $47,111. That means that your net pay will be $92,889 per year, or $7,741 per month. Your average tax rate is 33.7% and your marginal tax rate is 40.6%.”
Government takes over a third right off the top for someone making $140,000. The state itself takes 8% plus 9.3% of everything over $66,296 up to $338,640 when even higher rates kick in.
Those employees buy homes at absurd prices compared to elsewhere and government takes its pound of flesh from property taxes.
The employees eat at local businesses and buy merchandise from local merchants. The minimum state sales tax rate is 7.5 percent.
Factor in capital gains taxes. Factor in health benefits paid by Google. Factor in Federal payroll taxes.
Let’s discuss corporate taxes.
The California corporate tax rate is 8.84%. This tax rate applies to C corporations and LLCs that report a net profit. Otherwise, they pay a flat alternative minimum tax (AMT) of 6.65%.
Only a handful of states have a higher top corporate tax rate.
If Google did not exist or was not located in California, none of that would happen.
Google Contributes More Than Its Fair Share
Google contributes mightily towards California and would do so even if it paid no corporate taxes at all.
Nonetheless, we have ingrates pissing and moaning about how these companies do not pay their fair share.
Add it all up, and Google contributes too much.
To pay its fair share, Google needs to relocate to a lower tax state.
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