Voters skeptical of major tax system overhaul 

 

While much attention has been paid to potential tax measures on the 2016 ballot, working in the background is an effort to overhaul the state’s tax system. The recently released Public Policy Institute of California poll shows how difficult a task that could be.

Presenting a proposal for overall tax reform is the Think Long Committee for California, part of the Berggruen Institute on Governance. A central change considered by the Think Long Committee is a tax on services. California has become a much more service-oriented economy in recent decades. Sales taxes on goods, once the main portion of state revenue, have dropped dramatically in the last half-century.

Newly installed Sen. Bob Hertzberg, D-Van Nuys, a Think Long Committee member, will be driving the discussion on tax reform in the Legislature. He has introduced Senate Bill 8, which proposes to look at a number of changes to the tax system. His bill discusses broadening the tax base by providing a tax on services, evaluating the corporate income tax and examining the impact of lowering the personal income tax.

Brown legacy

The Think Long Committee is also talking to Gov. Jerry Brown, hoping he will tackle tax reform as he puts together his “legacy” agenda.

The idea to broaden the tax base by including services and lowering the sales tax rate was tested in 最佳的在线扑克 the PPIC poll. A tax on services was rejected by 63 percent of likely voters (25 percent favored). Although that number fell to 49 percent opposed (39 percent favored) if a drop in sales tax rates accompanied the service tax.

PPIC reported the share of voters who think the state and local tax system is in need of major change is at its lowest point since PPIC started asking the question in Jan. 2010. The fewer voters who see flaws with the current tax structure, the more difficult it will be to propose radical changes.

Let’s point out, however, that a plurality still thinks major changes are in order.

When asked if the state and local tax system was in need of either major changes, minor changes or is just fine, 44 percent chose major changes; 38 percent said minor changes were in order and 16 percent opted for leaving things be.

However, as the poll indicates, any changes along the lines of major tax reform will require a massive education effort to convince the public, which has the final say.