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You are thinking locally. Nobody cares where Tesla or Toyota build their cars. Having your business located "in the largest economy" isn't a factor for a huge number of businesses.

Another way to put it is: You can build a massively successful business anywhere in the country. There is no particular magic in California in this regard. What is different here is that it cost more to simply exist in this state. And there's far more to it than wages at play.




But the costs of running a business are much more than taxes and regulations.

Here is the TL;DR:

Businesses want the benefit of low taxes (lower immediate expenses) with the benefit of high taxes locations (government provide services that the business would otherwise have to pay).

But low tax utopia fails if no one pays high taxes needed to provide the services.

Longer explanation here:

http://sworddance.com/blog/2014/10/23/california-is-awesome-...

and here:

http://sworddance.com/blog/2014/10/23/low-business-tax-utopi...


It's not just taxes, it's everything. Doing business in California, depending on what you do, can be very difficult. If you are a website designer none of this is likely to make sense. If, on the other hand, you happen to own an manufacturing facility as I do, yeah, you get it and I don't have to explain it.

Quick example. There's something in the County of Los Angeles called "Business Property Tax". It is officially considered a "privilege tax", meaning, you pay for the privilege of doing business within and through the County of Los Angeles. All of it is nonsense but the "through" part is particularly sickening. Even if your business is in Arizona, if you DRIVE THROUGH LA to do business you are, in theory, supposed to pay for this tax. Thankfully they can't keep track of such things yet so they are not pissing all over this country asking for money.

But wait, what is this "Business Property Tax"?

Is it a tax levied on the building you own or lease?

Nope. Not at all.

Do you own a desk? A computer? A printer? A trash can? A fax machine? Did you change the carpets at the office you rent (Did you do any tenant improvement work)? Do you have desk lamps? Chairs? Shelves?

Yes? OK, hand over the receipts to the County of Los Angeles, you have to pay TAXES on your business property.

No bullshit. Here:

http://articles.latimes.com/1997-01-21/business/fi-20589_1_p...

and here:

http://lacountypropertytax.com/portal/contactus/ppa.aspx

Even if the computer you are using is yours --not owned by the business-- you can technically be required to pay this tax on it because it is used by the business and controlled by the business to a degree.

Utopia? Well, it's very real. And it is absolutely fucking unbelievable. It isn't a lot of money, somewhere in the order of 1$ annually. But the concept that the County of Los Angeles grabs a 1% tax FOREVER on that laptop you bought for your business on an annual basis is, well, sorry, only raw sewage dumped on this page could begin to describe what I think of taxes like this one. It's theft, that's what it is.

Because the tax is small people have better things to do than to fight it. And, because a lot of voters are predisposed or easily convinced to be anti-business trying to get it repealed is likely to fail as smart politicians would quickly weaves all kinds of lies about greedy business men wanting to take food away from poor children. Theft.

And like that there are many other little needles California loves to stick into you depending on the type of business you are in. A friend of mine leases about four million dollars of manufacturing equipment.

This is why some of the comments I read on HN get me riled up at times. It is easy to tell they mostly come from twenty-somethings who have not been exposed to the real world enough to get a nice tan bordering on a burn and truly understand things.

We need to aggressively cut down on taxation and remove nearly all incentives for politicians to tax us. If we don't we end up with hundreds of little 1% taxes that, collectively, only serve to pay for their pensions and wasteful spending and do nothing, absolutely nothing, for society. Next time you get gas anywhere pay attention to how much and how many taxes and fees you are paying and then try to square that away with the condition and disrepair of our roads and bridges.


So move to Kansas.

They are doing exactly what you want.

Seriously. Move if it is so bad. Otherwise, realize that paying taxes is part of the cost of doing business.




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