While researching California's Paid Family Leave plan, I saw this on Wikipedia: This arrangement contributed to a budget crisis when capital gains tax income fell along with the stock market. The flat tax idea enjoys a lot of support, and is practiced more-or-less in a few places. It is still interesting to talk about, even if it is not likely to come into existence. I would be curious to know how close your 20% figure would come to generating the same amount of tax revenue.One potential problem is that a substantial portion of the state's income comes from income taxes on a small proportion of wealthy citizens. For example, it is estimated that in 2004 the richest 3% of state taxpayers (those with tax returns showing over $200,000 in yearly income) paid approximately 60% of state income taxes.