The problem with high tax rates and high earners

California raised taxes on high-income earners in 2012. The higher taxes and a growing economy contributed to the Golden State government’s $21 billion surplus, but the tax windfall was 45% lower than it could have been because people moved and found other ways to reduce their tax bill. People do respond to tax rate changes.

Joseph Coletti / Senior Fellow, Fiscal Studies

Joe Coletti is a senior fellow at the John Locke Foundation focused on fiscal policy issues. He previously headed the North Carolina Government Efficiency and Reform initiativ...