California Gov. Jerry Brown speaks at a gathering of political, business and community leaders at the annual California Chamber of Commerce Host Breakfast in May 2015. Brown will release his revised budget proposal next month. (Rich Pedroncelli AP)
By Jim Miller
April 27, 2016 – 2:29 PM
- Two-fifths of taxpayers saw gains in average real income from 1995 to 2014, new data show
- That is an improvement over 1994-2013 span, when only top-fifth had real growth
- Average income of top 1 percent almost doubled over past 20 years
The wealthiest Californians paid nearly half of the state’s income taxes in 2014 after seeing an uptick in their average income from 2013, according to updated income distribution data compiled by the state Franchise Tax Board.
The Top 1 percent weren’t the only ones who saw their average incomes – and share of the tax burden – increase in 2014. For the first time in years, average adjusted gross incomes increased across all five taxpayer groupings analyzed by the tax agency.
Wealthier filers had the largest gains, though. And only the top two-fifths of filers had average incomes in 2014 that exceeded average incomes 20 years ago, after adjusting for inflation.
The financial well-being of California’s wealthiest taxpayers is a major concern of state budget planners. California’s revenue stream relies heavily on income taxes, a volatile source that recently prompted words of warning from Moody’s credit rating service.
California’s wealthiest filers had 48 percent of the tax burden in 2014, the highest since 2012, when it was 50.6 percent. That year’s figure reflected the fact that many high-income filers had shifted income into 2012 to avoid a tax hit from the expiration of federal tax cuts first approved under then-President George W. Bush.
The next-highest Top 1 percent tax concentration was 48.1 percent in 2007, right before the state slid into a deep recession. The wealthiest Californians’ share of tax revenue dropped to 36.9 percent in 2009.
To read expanded article, click here.