John and Ken

John and Ken

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Texas's Budget Surplus and California's Deficit Forecast

Everything is bigger in Texas, and it sure projected that when the Lone Star State surpassed their budget of $32.7 billion-record. In contrary to Gov. Gavin Newsom, his predictions from last year when he threw a $100 billion budget surplus plan for California. Unfortunately, on Tuesday, he announced the $22.5 billion deficit projected for the coming year.

The sunshine state collected a revenue of “$210.5 billion last year from $146 billion in 2019,” but with many tech companies dealing with the lifted interest rates, this caused them to disarrange.

State income-tax revenue is projected to be lower than last year’s vision. But that income-tax collections are expected to be only $2.2 billion lower and projected to grow by $582 million.

Texas is gaining from the growing global demand for oil and gas, that their earnings have grown $5.3 billion since 2019!!

Although, Texas’s budget isn’t as dependent on oil and gas as California is with Silicon Valley. According to WSJ, a majority of Texas’s gainings come from “the surging sales-tax revenue from inflation and population growth.”

Newsom claimed that California has a more “fair” tax system than Texas but apparently, that was incorrect. that Texans pay more in taxes.  According to the Census Bureau, California’s per capita state tax collections ($6,325) were second highest in the country in 2021 after Vermont. Texas’s ($2,214) were second lowest after Alaska.

Texans tend to pay higher property taxes without having to pay income tax while Cali., middle-class groups are up a 9.3% rate just on earnings for a single filer at $61,214.

Gas, local and state tax is higher in California than Texas, and this won’t help the situation in any way as Cali's wealthy and middle-class families are making the bounce to other states to call home.

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