Proposition 3
Make income taxes on higher earners permanent to fund education and healthcare
The tax, first enacted in 2012, is set to expire in 2031. Under the measure, income taxes for top earners range from 10.3% (for individual income over $360,000) to 12.3% (for individual income over $721,000), with graduated rates in between. Eighty-nine percent of the money goes to K-12 public schools and 11% goes to community colleges, with any excess going to public healthcare. The tax typically raises $5 billion to $15 billion a year — about 3% to 10% of overall K-12 spending. The California Teachers Association put this measure on the ballot.
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Summary
Support
The tax has been a vital source of revenue for schools. Supporters say if Prop. 3 fails, the loss of up to $15 billion a year for schools will likely lead to layoffs, program cuts and other reductions.
Oppose
Opponents point out that California already has some of the highest income taxes in the country. They say the measure may spur wealthy Californians to leave for lower-tax states, taking jobs and revenue with them.
Endorsements
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- California Taxpayers Association
- Reform California
Commentary
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Proposition committees
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Outside spending
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Video
Ballot text
PROVIDES PERMANENT FUNDING FOR SCHOOLS AND HEALTH CARE BY EXTENDING EXISTING TAX ON HIGH INCOMES. INITIATIVE CONSTITUTIONAL AMENDMENT. Makes permanent existing voter-approved tax rates for individuals earning over $371,000 (adjusted annually for inflation). Allocates tax revenues to public education. Fiscal Impact: Maintains $5 billion to $15 billion of annual state income tax revenue by making a temporary tax increase on high-income earners permanent instead of letting it expire in 2031.
Source: California Secretary of State
