Survey: Red Tape Behind Small Business Exodus From California

LOS ANGELES (CBS) — More local small business owners are having doubts about staying in California.

A survey taken by Small Business California (SBC) finds over 20 percent of respondents do no expect to be doing business in the state within the next three years.

KNX 1070’s Ron Kilgore reports the oppressive regulatory climate and ever-expanding “red tape” are among the more popular reasons owners have cited for leaving.

Many also pointed to more business-friendly climates in other states like Nevada, Arizona, and Texas offering better “ease of communication, travel and shipping”.

SBC president Scott Hague says the high number of business expected to close or leave the state is “frightening”.

Hague says most small companies can’t afford to leave, but many large firms have found it difficult to turn down states with better tax incentives and cheaper cost of doing business.

(©2010 CBS Local Media, a division of CBS Radio Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Wire services contributed to this report.)

  • Duh!

    Why is this surprising?
    A governor got voted in whose whole platform was to raise taxes. He has done it everywhere he has been.

    So business who are just surviving right now will not be able to continue with the new taxes that Brown will enact. So the companies are taking their jobs and leaving the state.

    If you vote for more taxes, be prepared for your job to leave the state. It would have been better had we put a governor in place that knows more about business and economics.


    How can any business survive in California with it’s tax burdens & restrictions? Especially small businesses when they depend on cheap labor, illegals, to do their work & no need to pay illegals health insurance. illegals work for much less with no health insurance & small businesses doesn’t have to hire accountants to do their taxes if they’re just paying under-the-table Cash to these illegals. Filing taxes should be a breeze for these small business owners.

    Now the problem lies ahead when OBAMA’s mandatory health insurance takes effect in 2014 & the FACT that California passed a law that prohibits businesses from hiring such illegals. The CONSEQUENCES of being caught hiring illegals are FINES & possible prison time. Most likely just a Fine but probably prison for repeat offenders.

    Simply too costly to do any type of businesses in California..

  • hamhead101

    800 for an LLC every year plus all the taxes they are killing us

  • David Garcia

    this is the problem with our government. there has to be oversight to help protect small businesses and promote growth!

blog comments powered by Disqus
Sandwich Generation

Listen Live