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California's Proposition 30: Innovation Drain from CA?

There are a lot of members of Proformative that are in California and New York. I would venture to guess that nearly 75%+ are. I was listening to the radio at lunch when I heard of an article written on Prop 30 and its negative implications on business, start-ups, investors, etc. I have never lived in CA, nor have I had the chance to visit. Do you think Prop 30 will have negative implications on the various pieces of business? Why? Will investors slow down investing in entrepreneurs? Alternatively, if I were an investor, what could entrepreneurs do to lure me to their business, given the new tax proposal?

 

Remember, as to be professional, let's keep the political bashing away from the question and answers. I am interested in the business aspect only, not how terrible the "other side" is. I live and work in Tennessee where taxes are rarely raised, when taxes are raised it isn't welcomed, but our local economy (Knoxville) continues to grow. I would guess that if TN increased many of its taxes like CA and other states have there would be little time before some of our multinational corporations looked elsewhere.

 

What is keeping a state like TN from attracting entrepreneurs at the rate CA has?

 

Your thoughts?

Answers

Topic Expert
Joseph Ori
Title: CEO
Company: Paramount Capital Corporation
(CEO, Paramount Capital Corporation) |

I live in CA and Prop 30 is only the latest assault on entrepreneurs and the private sector. Many people and cos are leaving the state because of the high taxes and overbearing regulation. A number of the large tech cos based in CA may not leave but they are not expanding in the state. The current business environment is terrible and will get worse as higher tax rates produce less revenue. Another impediment to new business formation in CA is the $800/yr minimum tax on LLCs, L/Ps and corps.

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