Here's A Radical Idea
Governor Schwarzenegger is willing to consider "radical" ideas like a flat tax in an effort to raise more money for California. While some tax plans might be better than others, this misses the point. California has been taxing its citizens more than most states for quite a while now. The state has had more money to work with than other states for quite a while now. The trouble has been that the state has no trouble spending more every year, no matter how much they get. That's the part of this relationship they need to fix.
posted by LAGuy @ 12:29 AM
4 Comments:
No doubt everyone thinks they are taxed too much- but where does your claim that "Califormia has been taxing its citizens more than most states" come from? While I suspect its true, I also note that "Taxachusetts" keeps coming up in the mid to lower ranges of state rankings for indidivual tax burdens and yet that doesn't stop the claims or the perception.
These studies are fraught with controversy- which taxes do you count, which tax payers do you count? etc... but I'd interested to see where California comes out.
(Interesting side note- I attended the International Economic Development Council conference in Oakland in 2002- and study of attitudes showed that while California came in third among the states for being the most business-friendly, on a searate survey, it also came in first as being the ost business-unfriendly. Perceptions are like poems, they don't have to mean, they just have to be)
NE Guy
I so often criticize other people's numbers on this blog that I try to avoid throwing around statistical claims based on subjective feelings.
To give a couple examples to back up what I said:
Last year, depending on where you lived in the state, the sales tax was 7.25% to 9.25%. Since then, everyone's rates have been raised another 1%.
http://www.taxadmin.org/FTA/rate/sales.html
http://www.boe.ca.gov/news/pdf/l212b.pdf
The state individual income tax, recently raised .25% on the high rates, starts at 1% and goes up to 10.55%. 4% kicks in at $16,995. 6% kicks in at $26,822. 9.55% kicks in at $47,056. We're number 1!
http://www.taxadmin.org/fta/rate/ind_inc.html
http://latimesblogs.latimes.com/money_co/2009/02/california-tax.html
Suddenly Taxachusetts doesn't sound so bad, huh?
I should add that not so long ago we had a surplus. Since then, if state spending had only gone up with inflation (taking the population into account) we wouldn't have a deficit now.
We also have more state employees and compensate them better than most states, and if you don't believe me, look it up.
One more thing--though you can see almost everyone takes a hit in California, I don't generally care who is taxed when I talk about the overall tax burden. High taxes can stifle an economy, and even if you only tax all those nasty rich people, that means they have less to spend or to invest or to pay employees or to create jobs. And if you tax them enough, they'll spend a lot of time and money figuring how to avoid paying. If they can't figure out an easy enough way, they'll leave.
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