While voters‚Äô attention is being diverted to the three major statewide tax increase measures on the November ballot (Propositions 30, 38 and 39), many taxpayers are about to be hit below the belt by local politicians, who are just as anxious to get their hands on more cash as are their Sacramento brethren.
Michael Coleman, the creator of CaliforniaCityFinance.com, has tallied the number of local tax hike measures that will appear on the Nov. 6 ballot. Voters will decide on 237 tax increases or extensions including 106 school bonds with a face value of $11.7 billion ‚Äî about half of the eventual cost after interest is paid. Additionally, there are 25 measures to increase or extend school parcel taxes, property taxes that are placed on parcels of property without regard to the parcel‚Äôs value. Then there are another 106 non-school related revenue measures that include 23 parcel taxes, 35 sales tax increases or extensions, and 42 special taxes ‚Äî those earmarked for a specific purpose.
Although these are local tax measures, their overall impact cannot be separated from statewide efforts to increase taxes.
In good times and bad, both state and local agencies sing a sad song about lack of funds and the need for greater contributions from taxpayers, but the problem is not that taxes aren‚Äôt already high enough. California already has the highest state sales tax in the nation (local sales taxes are extra), we are tied for highest gas tax, we are second in income tax rates, and even with Proposition 13 we are closer to the top than the bottom in property tax burden.
The real problem, and the primary reason that governments are not seeing a healthy flow of tax revenue, is that taxpayers are struggling. Taxpayers have less ‚Äî our unemployment rate is nearly a third higher than the national average ‚Äî and they have less to give to government. Already high taxes and stifling regulations are forcing businesses and the jobs they create from our state. Just this last week, two major firms, Campbell‚Äôs and Comcast, announced the closure of facilities and layoffs of 1,700 employees. And if past is prologue ‚Äî in 2011, 254 businesses either left the state or expanded their facilities elsewhere ‚Äî there are more facilities closures to come.
Ironically, after Comcast issued a press release saying the layoffs were due to the state‚Äôs dismal business climate, company officials were contacted by the Governor‚Äôs Office and a new release was generated, saying their previous statement was in error; the facility closures were really done for reasons of efficiency. While the governor is campaigning up and down the state for his Proposition 30 tax increase, he must find it extremely embarrassing to read news reports implying the state‚Äôs fiscal woes are due to Sacramento‚Äôs bad policies rather than tax rates that are not high enough.
So if you are one of the fortunate Californians with a job and whose employer has no plans to move out of state, don‚Äôt be fooled into thinking you are not already paying your “fair share.” If backers of tax increase measures cannot clearly and honestly demonstrate a vital need for more revenue to support a critical program, government officials must be sent a message that higher taxes are the wrong answer, especially when our state is wallowing in the depths of recession.
Jon Coupal is president of the Howard Jarvis Taxpayers Association ‚Äî California‚Äôs largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers‚Äô rights.