[Ed. – Because the problem with California is, there are just too many companies still hanging on here.]
The California State Senate is considering SB 1372, which would raise the top corporate tax rate by 47% to 13%. The proposal ties the corporate tax rate to the ratio of a company’s CEO compensation to that of its median worker. While proposals to cap CEO pay are not entirely novel, the Tax Foundation stated that California’s tax increase would be the first to attempt to do so through the tax code.
Proponents of the bill argue the measure would push “companies to put less money into the hands of their CEOs and more into the hands of average employees.” The legislation creates a sliding corporate tax rate scale tied to CEO pay. For CEO compensation from zero to 25 times the median worker compensation, the bill would cut California’s corporate rate from 8.74% to 7%. But for each multiple increase of 25 times CEO compensation, the corporate tax rate would increase 0.5%, up to a top rate of 13%.
California’s already has 10th highest corporate tax rate in the United States. The state legislature’s scheme would raise the top corporate rate to the highest of any state. When added to the top United States corporate income tax rate, which is the world’s highest at 35%, corporations would face a California top marginal rate of 48%. …
Chief Executive.net annual survey, which polls CEOs on business issues, revealed that CEOs rated California the absolute worst state for taxation and regulations in 2013, nosing out New York for the first time. By the proposing a 47% corporate tax rate increase, it’s a good bet that California will retain its worst rating with CEOs this year.