Despite record tax haul, legislators pursue further increases

Photo credit: 401kcalculator.org

Photo credit: 401kcalculator.org

With a big tax surplus flowing into state coffers, California shattered records last year with a historic haul dwarfing those of other large states around the country. This year, meanwhile, legislators planned still further increases.

“During the 2013-14 fiscal year that ended last June,” the Sacramento Bee reported, “California collected $138.1 billion in taxes of all kinds, 16 percent of all state taxes collected in the nation and more than the next two states, New York and Texas, combined.” The majority of the sum came from personal and corporate income taxes, according to the Bee.

Money maze

At first blush, California’s cash-in promised straightforward results. “Through the end of March, state general fund revenue was about $1.3 billion ahead of projections,” Jason Sisney, California’s chief deputy legislative analyst, told the San Francisco Chronicle. “April revenue is likely to add at least $1 billion more than projected.”

But thanks to the Golden State’s arcane fiscal requirements, revenue was set to be apportioned in counterintuitive ways:

“Under the state’s budget formulas, ‘virtually all or more than all of the additional revenue, relative to projections, may be required to go to schools and other statutory and budgetary commitments, such as the state’s rainy-day fund and debt payments,’ Sisney said. As a result, ‘The amount of extra state money available for other purposes could be little or nothing, and in some scenarios, reducing non-school spending on programs could be required.'”

Tax watchers, the Chronicle noted, paid special attention to a surge in taxes amassed through payroll withholding. In a report cited by the Chronicle, Standard & Poor’s called the increase “a sign that California’s economy is firing on all cylinders.” But that interpretation did not extend to the Golden State’s self-employed economy, since entrepreneurial taxpayers don’t have their taxes withheld in advance by an employer.

New hikes foreseen

Despite the influx of revenue, legislators have not been satisfied with tax rates. Assembly Bill 464, introduced by Assemblyman Kevin Mullin, D-South San Francisco, “would give local governments the power to add another 1 percent to the combined state-local sales tax rate with voter approval,” the Bee reported.

Senate Bill 16, meanwhile, introduced by state Sen. Jim Beall, D-San Jose, would hike several of California’s car-related taxes and fees. “The measure would increase the state gasoline tax by 10 cents per gallon, raise the state vehicle annual registration fee by $35, and levy a $100 per year surcharge on zero-emission vehicles that don’t use gasoline,” The Bond Buyer noted. “Beall’s plan also would phase in a 3.5 percent increase in state vehicle license fees over five years.”

On at least one issue where elected officials remain divided, the prospect of higher taxes has deepened. Although the push to legalize marijuana in California would presumably bring more tax revenue to Sacramento, Colorado’s uneven experience with the process has led to increasing reticence among Californians who don’t want to struggle with similar problems. As CalWatchdog noted previously, Coloradan legislators have divided over what to do with the excess tax revenue.

Up in smoke

marijuana-leafThe indirect tax consequences of legal marijuana could also mount. At a recent panel convened by the Northern Californian chapter of the ACLU, “Paul Gallegos, a former district attorney in the marijuana-growing heartland of Humboldt County, noted that a pot plant needs 6 gallons of water each day over its 150-day growing cycle,” according to ABC News. Amid California’s protracted drought, water rates and rationing penalties could be dramatically effected.

Finally, more comfortable on more familiar ground, some legislators have re-trained their attention on increasing taxes on tobacco products. State Sen. Richard Pan, D-San Francisco, “wants to raise California’s tobacco tax by $2 a pack, to bring in $1.5 billion a year for smoking prevention and smoking-related medical costs now borne by taxpayers through Medi-Cal, the state’s healthcare program for the poor,” the Los Angeles Times reported.

23 comments

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  1. Colonel Bill Kilgore
    Colonel Bill Kilgore 25 April, 2015, 10:27

    “With a big tax surplus flowing into state coffers, California shattered records last year with a historic haul dwarfing those of other large states around the country. This year, meanwhile, legislators planned still further increases.”

    [email protected] straight. Tax the shiite outta ’em. Tax ’em good and hard and then tax ’em again.

    Tax ’em to the stoneage, son!

    I love the smell of tax increases in the morning.

    Get back to work, you tax livestock.

    Reply this comment
  2. Richard Rider
    Richard Rider 25 April, 2015, 16:13

    Sooo, with CA paying 16% of the nation’s state taxes, and having only 12% of the nation’s population, Californians are paying 33% higher tax rates overall than people in other states.

    Of course, for people above the bell-shaped curve, that percentage is much higher. For the evil top 10%, it’s much, MUCH higher — thanks to our uber-progressive state income tax — which clearly the legislature hopes to make permanent.

    REMINDER ON CA INCOME TAX:

    Prior to Prop 30 passing in Nov. 2012, CA already had the 3rd worst state income tax rate in the nation. Our 9.3% tax bracket started at under $50,000 for people filing as individuals. 10.3% started at $1 million.

    Now our “millionaires’ tax” rate is 13.3% – including capital gains (CA total CG rate now the 2nd highest in the world!). 10+% taxes now start at $250K.

    CA now has by far the nation’s highest state income tax rate. We are 21% higher than 2nd place Hawaii, 34% higher than Oregon, and a heck of a lot higher than all the rest – including 7 states with zero state income tax – and 2 more that tax only dividends and interest income.

    CA is so bad, we also have the 2nd highest state income tax bracket. AND the 3rd. Plus the 5th and 8th.
    http://taxfoundation.org/sites/taxfoundation.org/files/docs/ff2013.pdf Table #12
    and
    http://tinyurl.com/CA-income-tax-graph
    and
    http://tinyurl.com/CA-2nd-CG

    Reply this comment
    • SeeSaw
      SeeSaw 25 April, 2015, 19:34

      Keep in mind that the gross income is taxed after the standard, or itemized deductions are taken and after the CA credits are deducted . CA does not tax SS income and it gives doble credits and a larger standard deduction to senior citizens. My total state income tax liability this year was less than $1800. That is not excessive at all–quite reasonable in fact!

      Reply this comment
      • bob
        bob 25 April, 2015, 23:37

        So you get a CalPers pension that is 109% of your salary and you don’t even pay $1800 a year. What a deal!

        You’ll work poor Desmond to death to pay for it all and then you’ll dance on his grave.

        Reply this comment
        • SeeSaw
          SeeSaw 26 April, 2015, 00:29

          I have explained to you before–I chose an optiion with a beneficiary–my spouse–and I forfeited 13% of that pension off the top. My total pension was less than $50,000 and my spouse and my total income is less than $100,000. We are both over 65, and indeed our CA State Income Tax liability this year was $1841.. That’s why I continue to emphasize that CA’s State Income Tax is no ripoff! It is the federal income tax that takes a big bite, because 85% of my spouse’s SS income is taxed–I also lost my SS spousal share at my retirement due to the GPO. Why you continue to make me a poster child for outlandish pensions is beyond ridiculous–neither you or Desmond has ever had anything to do with the cost of my pension and you never will. If it were not for public workers having pensions, there would be no customers for your product, whatever it is. Stop sniveling.

          Reply this comment
          • bob
            bob 26 April, 2015, 09:41

            But you had an option and it’s not like you got nothing for the 13%.

            You somehow think that just because you get off paying only 1800 that makes the CA tax low for everyone else, failing to see that just makes it an even bigger ripoff for people like me and people like Desmond who aren’t represented in Sacramento by parasitical lobbyists sticking it to working stiffs like me and Desmond.

            And saying Desmond and I have nothing to do with your pension is just absurd. You can sugar coat it with as much dystopia as you want but the taxpayers still have to pay for it.

          • bob
            bob 26 April, 2015, 09:45

            If it were not for public workers having pensions, there would be no customers for your product, whatever it is.

            Now that is just laughable. With it’s insane regulations, high fees and taxes, the state is doing everyting it can to destroy the line of business I am in.

            Yet according to you I couldn’t get by without the state thugs trying to kill my livelihood. How disgusting.

            Your comments show how our so-called public servants are nothing more than public serpents far worse than the tyranny the British imposed on the colonists.

          • Richard Rider
            Richard Rider 27 April, 2015, 08:36

            SeeSaw, according to your gonzo “public employees = economic stimulus,” then we should have encourage California mobsters, street thugs and burglars to expand their numbers and productivity, as their increased spending will stimulate the Golden State economy.

            Of course, their higher spending is accomplished by first stealing their booty from those that earned it, reducing the victims’ spending in CA.

            Yours is the classic “Broken Window Fallacy” — the absurd assumption that breaking more windows creates work and stimulates the economy. But then, from you I would expect nothing less. Sniveling, indeed!

  3. Ted go mint Steele
    Ted go mint Steele 25 April, 2015, 18:54

    You want the gov services?…

    U gotta pay snvelors

    Reply this comment
    • Richard Rider
      Richard Rider 25 April, 2015, 22:43

      Gosh, thanks for the insight, Ted. Obviously the other 49 states don’t offer government services because they have lower taxes — especially the 7 with zero state income tax. Good to know!

      You might want to explain to these wasteland states their plight. I’m sure they’ll enjoy your wisdom as much as I do — giving it all the serious consideration it deserves.

      Reply this comment
      • bob
        bob 25 April, 2015, 23:41

        Well Richard, even with these high income taxes it’s still not enough, according to thieves like Mullin and Beall.

        If they have their way your going to get serviced good and hard.

        Reply this comment
        • SeeSaw
          SeeSaw 26 April, 2015, 00:37

          Well, Mr. Rider, the states with lower or no income taxes also have higher property taxes than CA. If you dislike CA so much, why not move to one of those other states. I am in full support of people living where they will be happy.

          Reply this comment
          • Richard Rider
            Richard Rider 26 April, 2015, 08:46

            Wrong again, SeeSaw. We pay HIGHER property taxes than most states. While our RATE is relatively low, our BILLS are higher. For you that’s doubtless a mystery how that can be so.

            FACT: California in 2014 ranked 17th highest in per capita property taxes (including commercial) – the only major tax where we are not in the worst ten states. But the median CA property tax per owner-occupied home was the 10th highest in the nation in 2009 (latest year available).
            http://taxfoundation.org/sites/taxfoundation.org/files/docs/TaxFoundation_2015_SBTCI.pdf page 73
            and
            http://www.taxfoundation.org/taxdata/show/1913.html

            Not to worry SeeSaw. I stay in the Golden State just to expose and irritate the California public employee labor union liars — such as yourself. I’m having too much fun to leave. For now, at least.

          • bob
            bob 26 April, 2015, 09:34

            With all these dedicated public serpents…er…sorry public servants who care so deeply about the poor, especially and with no other state even coming close to the amount of tax revenue it collects why does Colliefornia (as Ahnode calls it) have the nations highest poverty rate?

            Colliefornia has Nation’s Highest Poverty Rate
            http://www.sacbee.com/news/politics-government/capitol-alert/article2916749.html

        • SeeSaw
          SeeSaw 27 April, 2015, 08:00

          I am no special person that got $1800 because of any special arrangement. That is where my taxable income fell on the chart after taking the credits that everyone in CA uses–not just me. You can keep on claiming you pay me pension long as you want–opinions are cheap. Everybody has one. You are also able to leave CA if you think you will be treated differently in another state of your choice.

          Reply this comment
      • Teddy
        Teddy 27 April, 2015, 16:57

        Dick
        I didn’t say taxes were low little buddy
        I just said the snivel factor out here is high as usual
        You might like a more third world country better

        Reply this comment
        • Richard Rider
          Richard Rider 27 April, 2015, 21:16

          “I just said the snivel factor out here is high as usual.” No Teddy, you DIDN’T say that. You didn’t even infer that.

          You just blabber away, never using the LogicCheck app to see if you are making a lick of sense. You’re not.

          Teddy, no one said we shouldn’t pay taxes. Not even me. The issue is HIGH taxes — as if you didn’t know. As the other states amply demonstrate, one can get the desired state services for a LOT less cost than California state and local governments charge.

          Apparently you equate any state paying less taxes than CA with a “third world country.” Amazing.

          BTW, given that CA easily has the highest poverty rate in the nation, it seems that we get closest to your cherished third world country right here in the Golden State. If one moves to any other state, the poverty rate is lower. It’s YOU who should move to get out of this third world state!

          Reply this comment
  4. bob
    bob 26 April, 2015, 09:54

    The truth about taxes…As the Colonel said, get back to work tax cattle…

    Reply this comment
    • Ted
      Ted 27 April, 2015, 17:03

      Lol
      Odd duck
      Odd accent
      Love to see his birth cert
      Seems like he has anger issues

      Reply this comment
  5. desmond
    desmond 26 April, 2015, 13:11

    We are far along in development of software that is an actuarial marvel. It calculates the cost to society of keeping people alive through medical care and public services. Govt pensions and social security are part of it. Govt retirees do poorly in the analyses, because they paid so little. My generation will use these aids to manage society’s resourses in the future. There is no euthanasia involved, but we will pull the plug on medical resources that just keep a human organism going. This really is a new way of looking at humans. This is the audacity of change in the modern world. We struggle with the programming for a child with special needs, we do not have any hesitation with a govt retiree.

    Reply this comment
    • Ulysses Uhaul
      Ulysses Uhaul 27 April, 2015, 00:24

      Human labor is rented Desi……..any benefis after the rental period are like deferred compensation in lieu of higher cash flow drains during active employment.

      Reply this comment
  6. Bill Gore
    Bill Gore 27 April, 2015, 07:45

    Oregon has the Kicker: when state revenues exceed budgeted amounts, i.e. there is a surplus, that amount is REFUNDED (‘kicked’) back to said taxpayers. Doesn’t happen every year, and when it does it usually doesn’t amount to much, but IT’S THE THOUGHT THAT COUNTS…..

    Reply this comment
  7. Ted
    Ted 27 April, 2015, 16:59

    Lol
    Full on snivel fest
    Oh my

    Reply this comment

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