Prop. 30

Tax millionaires for electric vehicle programs

What would it do?

Prop. 30 would impose a 1.75% personal income tax increase on Californians making more than $2 million per year to fund a suite of climate programs. The goal is to clean up the state’s dirty air and help meet ambitious greenhouse gas reduction targets.

The proposition creates a new revenue stream to subsidize zero-emission vehicles and fund wildfire response and prevention — between $3.5 billion to $5 billion annually, growing over time, according to state analysts.

Most of the money — about 80% — would go towards rebates for people buying zero-emission cars and to build more charging stations. Half of that funding will go to low- and middle-income residents, who are disproportionately affected by poor air quality and heavy pollution. The state already spends millions each year on zero-emission vehicle programs and dedicated an additional $10 billion over the next five years to those programs in this year’s budget.

A quarter of the tax money would provide funding to hire and train firefighters, who are battling increasingly worsening wildfires. On average, the state spends about $2 billion to $4 billion annually putting out wildfires. 

The tax would go into effect in January 2023 and would end by January 2043, or possibly earlier, if the state is able to slash its emissions to at least 80% below 1990 levels for three consecutive calendar years. 

Why is it on the ballot?

As part of its strategy to address climate change, California has made bold promises to cut emissions to 80% below 1990 levels by 2050 and achieve carbon neutrality by 2045. But transportation remains the largest source of the state’s planet-warming emissions, representing nearly 50% of California’s greenhouse gases. 

The state won’t be able to meet its goals if it can’t transition away from fossil fuels. Affordable and efficient electric vehicles are critical to California’s efforts to tackle climate change and clean up its polluted air. By 2035, the state plans to ban all new sales of gas-powered cars. The state will also require Lyft and Uber drivers, by 2030, to log 90% of their miles in electric vehicles. But for many low and middle-income residents, purchasing an electric car is still out of reach. Many barriers still exist that make it difficult to obtain an electric vehicle, including low vehicle supply and high costs, lack of enough charging stations and surging demand. 

At the same time, the state is increasingly facing more deadly and catastrophic wildfires, which contribute to air pollution, poor air quality and worse health outcomes for millions of residents. 

One Minute Video

Prop 30

Arguments

For

Supporters say Prop. 30 would generate much-needed funding to address the state’s two leading causes of air pollution: Gasoline-powered vehicles and wildfires. They say the money would help accelerate the transition to electric vehicles, beef up the state’s charging infrastructure and provide more resources to firefighters, who must now work year-round to fight and prevent deadly wildfires. They argue that these investments will better put the state on track to meet its ambitious climate goals. 

Supporters

  • California Democratic Party
  • Lyft
  • State Building and Construction Trades Council
  • California Environmental Voters

Against

Opponents say that Prop. 30 is an unnecessary tax hike that Californians don’t need because everyone is feeling the effects of high inflation and surging gas prices. They say Californians continue to grapple with exorbitant cost of living expenses and already pay some of the nation’s highest personal income taxes. They argue that the tax would drive many residents out of the state to benefit a special interest: ride-share companies. In his opposition, Gov. Gavin Newsom also calls the measure a “cynical scheme” by Lyft. In addition, many opponents say Newsom’s recent $10 billion climate investment and a $97.5 billion surplus in this year’s budget makes the state well-equipped to pay for the transition to electric vehicles and additional wildfire prevention efforts. If the state should need more money, opponents argue that it could tap into budget surplus funds to pay for these ongoing programs.

Opponents

  • California Chamber of Commerce
  • California Small Business Association
  • Howard Jarvis Taxpayers Association
  • State Treasurer Fiona Ma

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Prop 30