Higher taxes and fees totaling more than $269 billion a year have been proposed and are awaiting action by state lawmakers, according to new research published by the California Tax Foundation. The dollar amount identified in Tax Watch: Major Taxes and Fees Introduced in the California Legislature would more than double the amount of state taxes and fees already paid by taxpayers. The report notes that these increases are being proposed at a time when the state expects to have a budget reserve of $13.5 billion.
The 33 bills and constitutional amendments included in the report were introduced in 2017 and remain active this year, or were proposed between January 1 and March 2.
The proposals carrying the highest costs for taxpayers:
Government-Run Healthcare Tax – $200 Billion. SB 562 (Lara) would establish a single-payer healthcare system, where California pays for all healthcare costs for those who live in the state. The program would cost $400 billion, requiring an estimated $200 billion in new taxes, according to proponents (others believe the cost would be even higher). The bill was introduced last year and remains on hold in the Assembly, as lawmakers consider alternatives and options for funding this, or a similar program.
Sales Tax on Business Services – $49 Billion. SB 993 (Hertzberg) would expand the sales and use tax to services used by businesses.
New Tax on California Businesses – $14.4 Billion. ACA 22 (McCarty/Ting) would impose a 10 percent new tax rate on net business income over $1 million. The proposal would effectively bring California’s corporate income and franchise tax rate to 18.84 percent – the highest business income tax rate in the United States.
The California Tax Foundation is a 501(c)3 nonprofit research organization founded by the California Taxpayers Association in 1980. The foundation has published Tax Watch annually since 2013, and updates figures throughout the year.
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