New Taxes
02-12-2009, 01:17 PM
#1
New Taxes
The compromise:
"A copy of the fiscal blueprint obtained by The Times shows that the deficit would be wiped out with $15 billion in cuts; $14.4 billion in new and increased taxes on sales, vehicles, gasoline and personal income; $12 billion in borrowing against future profits from the lottery; short-term loans; and various accounting maneuvers."
The $15 billion in cuts is really about $7.5 billion in cuts and $7.5 billion in additional spending over the next 2 years that won't be spent.
The taxes:
"* Income. A 5% surcharge on what the tax filer owes. This was the idea of nonpartisan legislative analyst Mac Taylor, who estimated the take next year at $2.3 billion.
The good thing about a surcharge is that it hits everybody who pays income tax, not just the super-rich. The middle class chips in as well as the wealthy. Democrats in the past have advocated raising the top rate, which adds only to the roller-coaster volatility of California's tax structure. When the rich have a good year, the state prospers; when they don't -- as now -- it becomes a pauper.
Another plus: The state income tax is deductible on the federal tax return.
* Vehicle license fee, the so-called car tax. Increase the annual fee on the value of vehicles from 0.65% to 1.15%, good for $1.2 billion annually.
This was a big concession for Schwarzenegger, who grandiosely blocked a scheduled return of the VLF to its historic 2% level in his first act as governor. The governor's "car tax cut" actually went on the books as a spending increase because all the revenue had gone to local government and Schwarzenegger agreed to make up for the locals' loss by sending them money from the state general fund. That dug the state deeper into debt.
The VLF is another state tax that can be deducted on the federal return.
* Sales. Increase the sales tax by one cent on the dollar, raising $4.5 billion annually.
This makes more sense than the 1.5-cent hike previously proposed by the governor. That was a bit scary. California's average sales tax already is 8 cents.
* Gasoline. Increase the per-gallon excise tax by 12 cents, generating $1.8 billion a year.
Motorists benefit because all the tax money goes to transportation. Specifically, the revenue will pay off loans owed by the general fund to the special transportation account.
* Dependent income tax credit. Dramatically reduce it from $309 to $103, gaining the state $1.4 billion a year.
This makes sense. Tripling the kiddie credit was one of the tax cuts -- along with the VLF -- that the state generously gave a decade ago when it was rolling in money and politicians eagerly were spending it all, either on new programs or tax breaks. The credit will return to the same amount it is for a single tax filer.
Besides helping to close the deficit, the income and sales tax increases benefit schools. Under Proposition 98, they get roughly 40% of general fund revenue."
http://www.latimes.com/news/local/politics...0.column?page=2
"A copy of the fiscal blueprint obtained by The Times shows that the deficit would be wiped out with $15 billion in cuts; $14.4 billion in new and increased taxes on sales, vehicles, gasoline and personal income; $12 billion in borrowing against future profits from the lottery; short-term loans; and various accounting maneuvers."
The $15 billion in cuts is really about $7.5 billion in cuts and $7.5 billion in additional spending over the next 2 years that won't be spent.
The taxes:
"* Income. A 5% surcharge on what the tax filer owes. This was the idea of nonpartisan legislative analyst Mac Taylor, who estimated the take next year at $2.3 billion.
The good thing about a surcharge is that it hits everybody who pays income tax, not just the super-rich. The middle class chips in as well as the wealthy. Democrats in the past have advocated raising the top rate, which adds only to the roller-coaster volatility of California's tax structure. When the rich have a good year, the state prospers; when they don't -- as now -- it becomes a pauper.
Another plus: The state income tax is deductible on the federal tax return.
* Vehicle license fee, the so-called car tax. Increase the annual fee on the value of vehicles from 0.65% to 1.15%, good for $1.2 billion annually.
This was a big concession for Schwarzenegger, who grandiosely blocked a scheduled return of the VLF to its historic 2% level in his first act as governor. The governor's "car tax cut" actually went on the books as a spending increase because all the revenue had gone to local government and Schwarzenegger agreed to make up for the locals' loss by sending them money from the state general fund. That dug the state deeper into debt.
The VLF is another state tax that can be deducted on the federal return.
* Sales. Increase the sales tax by one cent on the dollar, raising $4.5 billion annually.
This makes more sense than the 1.5-cent hike previously proposed by the governor. That was a bit scary. California's average sales tax already is 8 cents.
* Gasoline. Increase the per-gallon excise tax by 12 cents, generating $1.8 billion a year.
Motorists benefit because all the tax money goes to transportation. Specifically, the revenue will pay off loans owed by the general fund to the special transportation account.
* Dependent income tax credit. Dramatically reduce it from $309 to $103, gaining the state $1.4 billion a year.
This makes sense. Tripling the kiddie credit was one of the tax cuts -- along with the VLF -- that the state generously gave a decade ago when it was rolling in money and politicians eagerly were spending it all, either on new programs or tax breaks. The credit will return to the same amount it is for a single tax filer.
Besides helping to close the deficit, the income and sales tax increases benefit schools. Under Proposition 98, they get roughly 40% of general fund revenue."
http://www.latimes.com/news/local/politics...0.column?page=2
02-12-2009, 10:19 PM
#7
Registered User
Join Date: Jun 2001
Location: La Mirada
Posts: 4,319
Likes: 0
Received 0 Likes
on
0 Posts
Isn't it time for some out of the box thinking on state taxes? Let's legalize prostitution, gambling, marijuana, and tax them. The last thing we need is more of the same, sales and gas tax! 
Trending Topics
02-12-2009, 10:30 PM
#8
Registered User
Join Date: Oct 2007
Location: OC, SoCal
Posts: 2,631
Likes: 0
Received 0 Likes
on
0 Posts
Shoot while your at it allow gay marriage, just tax the crap out of it lol
Just awesome that our state has one of the biggest economies in the world yet we don't know how to manage our books haha.
Just awesome that our state has one of the biggest economies in the world yet we don't know how to manage our books haha.
02-13-2009, 12:10 AM
#9
Registered User
Join Date: Dec 2007
Posts: 566
Likes: 0
Received 0 Likes
on
0 Posts
Well, its when you let frivolous government spending take place into the hands of a Governor who has no clue and we end up having as is 
and you get no choice.
I dont mind the tax hikes, we dont have a choice and it was bound to happen, but to remove teachers and raising prices for school when will it end.. You might as well end education while ur at it governator... POS!
This is what happens when u let a leader become leader with little to no experience.. or in Bush's case just plain stupid. Reagan was enough, now it arnold... Whats next more tax on education, even making it more likely for students to quit because they cant afford it.
thinking caps ON
and you get no choice.I dont mind the tax hikes, we dont have a choice and it was bound to happen, but to remove teachers and raising prices for school when will it end.. You might as well end education while ur at it governator... POS!
This is what happens when u let a leader become leader with little to no experience.. or in Bush's case just plain stupid. Reagan was enough, now it arnold... Whats next more tax on education, even making it more likely for students to quit because they cant afford it.
thinking caps ON
Thread
Thread Starter
Forum
Replies
Last Post
North Star
Car and Bike Talk
8
05-14-2014 07:21 AM
forsaken
California - Southern California S2000 Owners
26
03-14-2008 05:59 PM