Compromise Tax Plan's Supporters Seek Help From Legislative Staff

TOPIC ALERT:

Supporters of a compromise tax hike proposal developed by Gov. Jerry Brown (D) and supporters of the "Millionaires Tax" have asked some Democratic staff members in the Legislature to circulate petitions in support of the plan, the Sacramento Bee's "Capitol Alert" reports.

According to Democratic members of the Assembly and the Senate, the volunteer effort is organized by the political, non-state arms of Democratic caucuses in both chambers.

Robin Swanson -- spokesperson for Assembly Speaker John Perez (D-Los Angeles) -- said staff members interested in helping collect signatures to qualify the proposal for the November ballot are "highly encouraged to do so ... on their free time and outside the building."

Supporters of the plan are seeking to collect more than 800,000 valid voter signatures by the middle of May to qualify the measure for the November ballot (Van Oot, "Capitol Alert," Sacramento Bee, 4/16).

Details of the Tax Plan

Last month, Brown announced a deal with the California Federation of Teachers and other supporters of the Millionaires Tax to merge their tax hike proposals into a new single initiative for the November ballot.

The revised tax plan includes a smaller sales tax hike and a larger personal income tax increase on the wealthy than Brown initially had proposed.

The proposal also would:

  • Increase the personal income tax by one percentage point for individuals who earn $250,000 annually or couples who earn $500,000 annually and by two percentage points for individuals who earn $300,000 annually or couples who earn $600,000 annually;
  • Extend the income tax increases on wealthy residents from five to seven years; and
  • Increase the sales tax by a quarter of a cent, down from Brown's original half-cent increase.

The sales tax hike would expire in four years, as called for in Brown's original plan.

The merged plan would raise an estimated $9 billion over the next fiscal year, $2.1 billion more than Brown's original proposal.

The compromise plan still faces competition from a plan by attorney Molly Munger, called "Our Children, Our Future." Munger's plan aims to raise income taxes for all residents, with the highest earners seeing the largest hike. Most of the funds raised would support education programs (California Healthline, 3/29).
Tom Johnson
I'm not affected by the "millionaires tax" or even the $250,000 threshold, so I have no dog in the fight. That said, I am skeptical of this tax hike proposal for several reasons: (1) Unless the pension issues are dealt with in a firm, uncompromising way, public agencies will never have enough money to provide the level of service needed even with tax increases. (2) There are huge wastes and inequities already in state spending that need to be addressed. Why should education spending go up only 5% over the last decade while prison spending went up 63%? (3) I have no confidence that our legislators will do the right thing with this new found tax money. Other initiatives have passed targeted towards specific needs, like roads, and yet the money gets frittered away either administratively by by the pressure of special interests. And finally, I think that these taxing measures will further alienate business and entrepeneurs whom California needs to cultivate.

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