REUTERS / Jessica Rinaldi
- Billionaire investor Jeffrey Gundlach hinted on Twitter he would leave California if local taxes rise for high-earners.
- The CEO of DoubleLine Capital said in a tweet on Saturday that Elon Musk, comedian Joe Rogan, and political commentator Ben Shapiro are leaving California to "escape incompetent governance."
- Taxes are likely to go up for the wealthy in nine states including California, where Democratic lawmakers are proposing an increase on the state's highest earners to help pay for a widening budget deficit caused by the pandemic.
- In the aftermath of the last financial crisis, between 2010 and 2012, eight states increased taxes on high-earners.
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Billionaire bond investor Jeffrey Gundlach hinted in a Twitter post that he would leave California for a lower-tax state if Sacramento hiked taxes on the wealthy.
In a tweet late Saturday, the so-called "Bond King" said: "Elon Musk, Joe Rogan and Ben Shapiro, to name just a few, are leaving California to escape incompetent governance. The "response" from Sacramento? Wealth and massive income tax increases on job creators (AKA "the wealthy"). Should I align with 3 smart guys, or Sacramento? Hmmm."
Democratic lawmakers in California are proposing higher taxes on the wealthy to plug the gap in ballooning budget holes grown out of the COVID-19 downturn. The move is under proposal in nine other states including New York, Massachusetts, and Maryland.
On September 17, lawmakers in New Jersey reached a deal to raise rates for millionaires earning between $1 million and $5 million to 10.75% from 8.97%. Income above $5 million is already taxed at 10.75%.
Gundlach shot to fame through some of the calls he made on the US fixed-income market, earning himself the nickname "Bond King."
He has previously criticized taxation, and questioned its purpose if "endless" borrowing by the Treasury Department is a viable option.
When the Treasury said earlier this year that it expected to borrow $3 trillion over the second quarter to cushion the impact of coronavirus, Gundlach became one among many voices to question fiscal policies being used to deal with the virus.
In the aftermath of the last financial crisis between 2010 and 2012, eight states increased taxes on high earners.
Previous income tax rates on the wealthy in California have not led to mass resident departures, according to a Reuters study from 2012.
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