Tech billionaires are making plans to bail on California ahead a possible ballot measure that would tax their assets to help pay for healthcare.
Sources told the New York Times that venture capitalist Peter Thiel has explored spending more time outside California and opening an office for his Los Angeles-based personal investment firm, Thiel Capital, in another state.
I’m not whining on their behalf, I’m warning that this approach to taxation will not hit the intended target. Billionaires whose assets are mostly concentrated in stocks have no reason to make California their primary residence. They can live anywhere in the world and if forced to they will do so.
If you want an effective tax on tech billionaires you should find a way to tax an asset they can’t move: intellectual property. That’s where all tech billionaires ultimately derive their wealth. I personally am against IP altogether, but I’ll take an IP tax as a consolation prize.
It goes without saying that land value tax is another tax on assets that can’t be moved. I also want to see LVT tried.
Billionaires can already live anywhere and they continue to live in their chosen country. They continue to live where they live because they enjoy living there.
Sure, and I’m glad you can derive satisfaction from the idea of chasing them out of California, but if that’s all you’re hoping for from tax laws then you’ve set the bar too low!