Death and taxes are all but certain. But the bright side is that the power to tax ultimately lies with the people, as Californians have the constitutional right to vote on local taxes, and the right to elect state officials with taxing power.
By Robert Gutierrez
Robert Gutierrez is president and chief executive officer of the California Taxpayers Association, Rob@caltax.org. He wrote this commentary for CALmatters. Read his past CALmatters commentary by clicking here.
April 15 is infamously known as “tax day” in the United States, but given the broad array of taxes we face, the reality is that every day is tax day, especially in California.
That alarm on the cellphone that wakes you up? You paid sales tax when you bought it at the highest state-level sales tax rate in the nation, plus local add-ons. You also pay a utility tax on the electricity that keeps your cell charged.
You get up, watch the television news (tax on cable service) and take a hot shower (utility taxes on water and sewer service).
You jump in the car (gas tax, vehicle tax, tire tax) and head to work, stopping to grab breakfast at a local cafe (sales tax on prepared food consumed on the premises).
You pay higher retail prices to cover the taxes imposed on the cafe and other businesses (property tax, business license taxes, corporation tax, etc.).
At work you receive your paycheck (nation’s highest state income tax for higher earners, federal income tax, Social Security tax, Medicare tax and State Disability Insurance tax).
You make plans for an out-of-town conference (hotel tax, federal transportation tax, 9/11 security “fee,” federal flight segment tax, federal passenger facility charge).
After work you meet a friend for tacos (sales tax) and a beer (alcohol tax), then head home (value-based property tax, parcel taxes, Mello-Roos tax, plus property taxes to repay local bonds). After reading a book (more sales tax), you hop in bed (mattress and box spring “recycling fees”) and repeat the cycle.
Thanks to all of these taxes, California’s government has a record budget reserve of $20 billion, according to the California Department of Finance.
Still, legislators proposed more than $6.2 billion in tax and fee increases as of the February bill-introduction deadline, and billions more were proposed by subsequent amendments.
These include a proposed repeal of tax exemptions for prescription drugs and other products, Senate Bill 468. There are tax-like “fees” on water users in Assembly Bill 217. There are proposed taxes on sugar-sweetened drinks, AB 138, and on services such as auto repair and dog grooming, SB 522.
There’s an estate tax, SB 378, and a measure that would drive jobs out of the state by making California’s business taxes the highest in the nation, SB 37.
On top of all of the proposals from lawmakers, a proposal to increase business property taxes has qualified for the November 2020 ballot. It would do away with Proposition 13 protections for business owners, resulting in more lost jobs and higher consumer prices.
Death and taxes are all but certain. But the bright side is that the power to tax ultimately lies with the people, as Californians have the constitutional right to vote on local taxes, and the right to elect state officials with taxing power.
This makes Election Day the most important tax day of all.
Why April 15 isn’t California’s most important tax day
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In summary
Death and taxes are all but certain. But the bright side is that the power to tax ultimately lies with the people, as Californians have the constitutional right to vote on local taxes, and the right to elect state officials with taxing power.
By Robert Gutierrez
Robert Gutierrez is president and chief executive officer of the California Taxpayers Association, Rob@caltax.org. He wrote this commentary for CALmatters. Read his past CALmatters commentary by clicking here.
April 15 is infamously known as “tax day” in the United States, but given the broad array of taxes we face, the reality is that every day is tax day, especially in California.
That alarm on the cellphone that wakes you up? You paid sales tax when you bought it at the highest state-level sales tax rate in the nation, plus local add-ons. You also pay a utility tax on the electricity that keeps your cell charged.
You get up, watch the television news (tax on cable service) and take a hot shower (utility taxes on water and sewer service).
You jump in the car (gas tax, vehicle tax, tire tax) and head to work, stopping to grab breakfast at a local cafe (sales tax on prepared food consumed on the premises).
You pay higher retail prices to cover the taxes imposed on the cafe and other businesses (property tax, business license taxes, corporation tax, etc.).
At work you receive your paycheck (nation’s highest state income tax for higher earners, federal income tax, Social Security tax, Medicare tax and State Disability Insurance tax).
You make plans for an out-of-town conference (hotel tax, federal transportation tax, 9/11 security “fee,” federal flight segment tax, federal passenger facility charge).
After work you meet a friend for tacos (sales tax) and a beer (alcohol tax), then head home (value-based property tax, parcel taxes, Mello-Roos tax, plus property taxes to repay local bonds). After reading a book (more sales tax), you hop in bed (mattress and box spring “recycling fees”) and repeat the cycle.
Thanks to all of these taxes, California’s government has a record budget reserve of $20 billion, according to the California Department of Finance.
Still, legislators proposed more than $6.2 billion in tax and fee increases as of the February bill-introduction deadline, and billions more were proposed by subsequent amendments.
These include a proposed repeal of tax exemptions for prescription drugs and other products, Senate Bill 468. There are tax-like “fees” on water users in Assembly Bill 217. There are proposed taxes on sugar-sweetened drinks, AB 138, and on services such as auto repair and dog grooming, SB 522.
There’s an estate tax, SB 378, and a measure that would drive jobs out of the state by making California’s business taxes the highest in the nation, SB 37.
On top of all of the proposals from lawmakers, a proposal to increase business property taxes has qualified for the November 2020 ballot. It would do away with Proposition 13 protections for business owners, resulting in more lost jobs and higher consumer prices.
Death and taxes are all but certain. But the bright side is that the power to tax ultimately lies with the people, as Californians have the constitutional right to vote on local taxes, and the right to elect state officials with taxing power.
This makes Election Day the most important tax day of all.
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