Chris Banescu | May 18, 2013
by Chris Banescu - Following the passage of Proposition 30 in November 2012, California's income tax rates have reached an astronomical 13.3% rate. Not only does California now have the most progressive income tax rates of all the states, individuals begin paying an 6% rate at $27,898 and an 8% rate at $38,727 in income, but it now surpassed Hawaii (11% top rate) as the state with the highest income tax rate in America. According to a 2013 survey from Chief Executive magazine California's business climate ranks dead last among all 50 states. Is it any wonder that so many companies, corporations, and high income individuals continue to flee California and relocate to other states? Proposition 30 raised income tax rates for all Californians earning more than $250,000 per year. It progressively increased tax rates from 1% to 3% for all individuals and families earning above that level. Higher income households now face a 10.8% to 29.1% increase in overall tax rates. Interestingly enough, when doing a web search for "California Income Tax Rates" none of the official state websites actually list the 2013 tax rates and the specific income breakdowns. Even the State of California Franchise Tax Board only shows the 2012 tax rates and has not updated tax tables to reflect the higher 2013 rates, more than 7 months since the passage of Prop. 30. Furthermore, except for a Bank Rate link that displays an incomplete list of the 2013 tax rates, none of the other top 20 search results provided by Google list the correct 2013 California income tax rates. Here's a brief summary of the California income tax rates effective as of January 1, 2013. I also compiled a more complete chart that includes the Individual and Joint Filers income brackets that is included below. California Income Tax Rates as of 2013 for single and married filing separately taxpayers:
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- 1% on the first $7,455 of taxable income.
- 2% on taxable income between $7,456 and $17,676.
- 4% on taxable income between $17,677 and $27,897.
- 6% on taxable income between $27,898 and $38,726.
- 8% on taxable income between $38,727 and $48,942.
- 9.3% on taxable income between $48,943 and 250,000.
- 10.3% on taxable income between $250,001 and 300,000.
- 11.3% on taxable income between $300,001 and $500,000.
- 12.3% on taxable income between $500,001 and $1,000,000.
- 13.3% on taxable income of $1,000,001 and above.