October 22, 2019

The Staggering Cost of Doing Business in California

“CNBC’s annual state-by-state “business climate” study is out. No surprise, we’re dead last — No. 50 — among the states for “cost of doing business.” Here’s an area where you don’t want to say, “As California goes, so goes the nation.”

Almost all of California’s business-climate problems are self-inflicted, as lawmakers try to balance conflicting interests.

Lawmakers, through various mechanisms, have significantly driven up the cost of energy. They began and renewed cap-and-trade, which the Legislative Analyst’s Office forecasts will raise gasoline prices in the years ahead — so the state can keep pushing its bullet train, which is heavily dependent on cap-and-trade funding.

They’ve imposed the nation’s highest state sales tax, highest income tax, and yet remarkably never seem satisfied with current levels of taxation.

In their 2019 State Business Tax Climate Index, the Tax Foundation ranked California as having the second worst overall business tax climate in the country.

But record revenues and a surplus haven’t been enough for state lawmakers, who have proposed a litany of tax increases this year.

Then consider the costs of doing business in a state consistently ranked by the American Tort Reform Association as the nation’s leading “judicial hellhole,” where businesses are routinely forced to fend off lawsuits.”

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