
California Gov. Gavin Newsom’s repeated claims in recent weeks promoting his state as more tax-friendly than Florida and Texas don’t add up, according to an expert who ran the numbers.
“Texas and Florida are the REAL high-tax states,” Newsom recently posted on X, explaining onstage at SXSW in Austin, Texas that California has the most “progressive tax rates in America” while taking shots at the tax burden in Florida and Texas.
“Your middle class pays more taxes in Texas than our middle class in California,” Newsom said in Texas. “It’s a great mythology, it’s just ‘the richest of the rich come here because they can avoid paying a damn penny.'”
The comments drew pushback from conservatives on social media, including Florida Gov. Ron DeSantis, and from Just Facts President James Agresti, who says he looked into a “number of different angles” to determine the “validity” of Newsom’s claims.
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“I looked at how much is each state taxing each of its citizens on average? So if you look at California, they collect about $10,000 a year in taxes for every person in the state, whereas the figures for Texas and Florida are only about $5,000, or about half as much,” Agresti told Fox News Digital.
“However, California is a higher-income state, so I also looked at it as a percentage of the states’ economies and what I found is that California taxes about 14% of its economy, as opposed to 9% for Texas and Florida.”
Just Facts broke those taxes down in a recent study and found that California imposes some of the highest taxes in the nation, with a top personal income tax rate of 13.3%, while both Texas and Florida have no state income tax.
Property taxes in California account for about 2.8% of personal income, slightly lower than Texas at 3.6% and close to Florida’s 2.6%, though measured as a share of home values, California’s rates are generally lower than both states, but in other tax areas, California is largely more burdensome.
The state’s unemployment insurance tax rate matches Texas at 6.2%, but is higher than Florida’s 5.4%. California also has a higher statewide sales tax at 7.2%, compared to 6.2% in Texas and 6.0% in Florida. Drivers in California face significantly higher gas taxes as well, paying 70.9 cents per gallon, more than triple Texas’ 20 cents and well above Florida’s 40.3 cents.
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A Wallethub 2025 analysis ranking U.S. states by overall tax burden showed California coming in at 4th overall, behind Vermont, New York and Hawaii. On a per-capita basis, California also collects significantly more in state and local taxes than either state, according to data from the Tax Foundation.
At the heart of the issue is the data, Agresti says, making the case that Newsom is likely pulling from the Institute On Taxation & Economic Policy (ITEP) which Agresti said is widely used by mainstream news outlets and experts but is “fatally flawed” because “it does not account for all forms of income or all taxes.”
Agresti has been speaking out against ITEP’s methodology for over a decade, explaining in a 2015 post that the group “uses a partial measure of income in virtually all of its studies” and is “based on calculations that exclude certain taxes.”
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ITEP’s analysis focuses on how tax burdens are distributed across income groups rather than overall tax levels. The group argues that states such as Texas and Florida look “low tax” largely because they do not levy a broad-based personal income tax, a structure that disproportionately benefits high earners.
To make up the difference, those states rely more heavily on sales, excise and property taxes, which tend to take a larger share of income from lower-income households. California, by contrast, uses a highly progressive income tax system that places more of the burden on top earners and helps offset regressive taxes lower down the income ladder.
Critics, however, say that framing captures only part of the picture because it focuses on tax burden by income group rather than overall tax climate, where California remains far more burdensome for top earners, investors and many businesses.
“It’s information from this group and others like it, by the way, that have misled people to believe that middle-income folks in the United States pay a higher federal tax rate than upper-income folks,” Agresti said.
“In fact, a survey done by Just Facts found that about 80% of America’s voters believe this fiction, even though the Congressional Budget Office, the U.S. Treasury, and the center-left Tax Policy Center all say that middle-income Americans pay an average effective federal tax rate of about 15% while upper income, or the top 1%, pay a rate of about 30%. And by the way, that includes all taxes and all income, all tax loopholes, it’s basically all taxes paid divided by all income earned or received.”
Fox News Digital reached out to ITEP for comment.
Agresti said Newsom is a “master of twisting statistics to paint a picture that is the exact inverse of reality” and pointed to the governor’s claim that the exodus of residents due to high taxes is a “myth.”
“Here’s the facts: According to his own Secretary of State, every year of Newsom’s governorship, more people have moved out of California into other states than have moved from other states into California,” Agresti, who has posted the data on his website, said. “In fact, over the time of his governorship, about 1.5 more million people have left California than moved in.”
“So how does Newsom get his claim, his evidence? Well, he looks at total population growth, which is dominated by immigrants moving in from other countries. The issue is not whether people would rather live in California than Mexico, but whether they would rather live in California than other states. And the data clearly show they do not.”
Newsom has also been touting data showing California now has the fourth-largest economy in the world, just surpassing Japan’s, which Agresti also took issue with and described as “fiction” according to his examination of the numbers.
“Here’s the fatal flaw in what he’s doing there,” Agresti said. “He is converting Japanese yen into U.S. dollars using a highly deceptive measure called foreign currency exchange rates. Scholars in this field warn explicitly: You are not to convert GDPs using exchange rates because it inflates the relative sizes of economies that have high prices, as California does. When you actually look at the proper way to transfer these exchange rates and account for them, Japan’s GDP is 56% larger than California’s.”
Additionally, Agresti pointed to data that shows California has a greater rate of poverty than any other state in the nation, as well as electricity prices that are more than twice the national average.
“When you look at California as a whole, it is one of the highest-tax states in the nation, and also there’s a lot of fallout from Newsom’s policies that make it one of the most expensive places to live in the entire United States,” Agresti said.
Fox News Digital reached out to Newsom’s office for comment.
Fox News Digital’s Bradford Betz contributed to this report.
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