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Thread: They just don't get it in California

  1. #1
    God/dess Deogol's Avatar
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    Default They just don't get it in California

    More taxes and more companies and individuals leaving...

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    Default Re: They just don't get it in California

    Quote Originally Posted by Deogol View Post
    More taxes
    Quote Originally Posted by Deogol View Post
    more companies and individuals leaving...

    hmmm, what are the chances they both hand in hand.

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    Featured Member Hello_Kitty27's Avatar
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    Default Re: They just don't get it in California

    Quote Originally Posted by glambman View Post
    hmmm, what are the chances they both hand in hand.
    Yeah no kidding! We just got the MillerCoors HQ deal in IL b/c we offered the biggest tax incentives. We've been getting a lot of companies, and it creates a decent amount of jobs (relative to the rest of the economy).

    Now if only they would stop raising the gd sales tax......but that's a whole different issue for another day....






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    Default Re: They just don't get it in California

    Quote Originally Posted by Deogol View Post
    More taxes and more companies and individuals leaving...

    http://online.wsj.com/article/SB1216...w_and_outlooks
    Just heard on the radio there are three to four possible tax increases being discussed by the California legislature. And in L.A. County, we have a possible initiative on the November ballot to raise the sales tax in Los Angeles County from the current 8.25% to 8.75%, which is to be used for road repair, highway/road construction and more mass transit. Riiiiiight! And I'm the freakin' Easter Bunny! Like it'll ever be used for that. Just another excuse for bureacrats & politicians to steal even more money from the general public!

    The legislature also wants to raise our car registrations, since they think they can get six billion additional dollars from making this change. Only problem is, it's not a good idea to pull this kind of sh*t when the economy is in a recession.

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    Banned Melonie's Avatar
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    Default Re: They just don't get it in California

    ^^^ well they've got the perfect excuse ... hybrid vehicles and alternate fuel vehicles make it impossible to collect 'road tax' via taxing gasoline sales, so they'll try and get more money out of registration fees and increased sales taxes instead !

    But you're circling around the inherent flaw in the California philosophy ... the California state gov't refuses to significantly cut spending on social welfare programs, to cut spending on public sector (government) employment levels, to cut spending on higher education etc. California's idea of a 'cut' is to expand gov't spending this year by a lower percentage than they expanded gov't spending last year.

    Instead of cutting spending in any meaningful way, California politicians have immediately moved toward proposals to increase taxation at the state and local level to support undiminished gov't spending. The 'tin foil hat' crowd will tell you that this will drive unsubsidized California businesses and middle class California skilled workers across the state line in huge numbers. Of course uber-rich Californians really don't care what's announced in the way of tax increases, since they have the means and the loopholes to avoid paying the majority of those increases in the same way they avoid paying 'official' tax rates under the current tax structure. And 'poor' Californians really don't care either since for the most part they don't pay any serious amount of tax.



    (snip)" Democrats on Tuesday proposed billions in tax increases on businesses and high earners to help bridge California's budget shortfall.

    The proposed hikes include rolling back the dependent child income tax credit expanded in the 1990s, creating two higher income tax brackets for the state's biggest earners and increasing corporate taxes.

    The long-awaited list of revenue proposals faces near certain defeat, however, as Republican lawmakers have repeatedly said they are unified in their opposition to any tax increases. Approving a budget and increasing taxes requires a two-thirds vote, which means GOP support is mandatory.

    "I guarantee you it will be a troubled and very challenged proposal on the Assembly floor," said Assemblyman Roger Niello, a member of the two-house budget conference committee that finished its work over Republican opposition Tuesday. "After we're done (rejecting the tax increases), we can all go back to square one to figure out how we get a supermajority vote on this budget."

    Gov. Arnold Schwarzenegger and state lawmakers have yet to strike a compromise on how to close a $15.2 billion budget shortfall in the $101 billion general fund. The entire budget proposed by the governor is $144 billion, including bond and special funds."(snip)

    (snip)"In earlier drafts of the budget, majority Democrats presented plans that called for as much as $11 billion in added revenues. Tuesday's proposals amount to $8.2 billion, plus another $1.5 billion from a proposed tax amnesty plan.

    Democrats have proposed before -- a 2005 move failed to receive a single GOP vote -- the creation of 10 percent and 11 percent tax brackets for high earners. The highest tax bracket now is 9.3 percent.

    The plan unveiled Tuesday would impose a 10 percent rate on the portion of couples' incomes above $321,000 a year and an 11 percent rate on the portion of income above $642,000.

    It would raise about $5.6 billion a year.

    Big business would lose its net operating loss deduction for three years, bringing the state another $1.1 billion, according to the Senate plan. And the plan would restore the franchise tax rate for businesses from 8.4 percent to 9.3 percent, raising $470 million.

    Reducing the dependent income tax exemption would bring the state about $215 million in the fiscal year that started July 1.

    Lawmakers and then-Gov. Pete Wilson expanded the child dependent exemption in 1997 and 1998 when the state's budget picture was brighter and tax relief was a necessary political piece to approve the spending plan.

    The Senate's proposal would apply only to households with adjusted gross income more than $150,000 a year. It would lower the current allowable exemption for each child from $294 to $94 - the same amount currently allowed for a personal exemption.

    Democrats rejected a more ambitious plan advanced by Legislative Analyst Elizabeth Hill who called for the dependent credit to be rolled back for all families, regardless of annual income. It would have raised $1.3 billion for then state.

    Niello and other Republicans said the tax proposals would drive businesses out of the state and hurt families already reeling from a flagging economy.

    Democrats countered that schools and health care programs will suffer without higher taxes."(snip)

    (snip)"State Controller John Chiang and Treasurer Bill Lockyer have warned several times that the state would face a cash shortage next month unless lawmakers can come to an agreement.

    A protracted budget fight, they warn, would force the state to borrow billions in an unfriendly lending atmosphere. The move would jeopardize the state's credit rating, which is already among the nation's worst.

    Already, the state cannot pay some programs for school districts, community colleges, local governments, vendors and salaries and per diem of state elected officials and their appointed staff."(snip)


    There is also a 'stealth' proposal in the California legislature which is meant to help the revenue of local gov'ts ... lifting the 2% cap on property tax increases which has been in effect since Prop 13 went into effect 20 years ago. With a 2% cap in force, even though California property values have fallen 20-30-40% from the peak levels of 2 years ago, the amount of property tax which local gov'ts are allowed to charge long time residents is still far below the levels that 'new buyers' have to pay in property tax (sale of the property voides the 2% cap protection).

    Think of it this way ... somebody who bought a median priced California home in 1987 the year Prop 13 went into effect paid $142k for the property. Last year, even after the decline, the median priced California home price was $529k ... an increase of 373%. However, under the 2% cap, property taxes on a continuous property owner since 1987 have only increased by 49%. Thus if you assume a 2% of value annual property tax for the sake of example, in 1987 the median price homeowner paid $2840 in property taxes, and after 20 years worth of 2% escalations now pays $4232. However, if the continuous property owner sells the property thus voiding the cap and resulting in a fresh tax assessment, the property tax would immediately jump to $529k *.02 = $10,580 per year. The proposal being floated would eliminate Prop 13 and the 2% annual property tax cap, which would immediately cause the property taxes for a long time median priced homeowner to jump from $4232 a year to $10,580 per year ! That will be quite a kick in the teeth for quite a few 'middle class' California homeowners.

    ~
    Last edited by Melonie; 07-18-2008 at 02:29 PM.

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    Default Re: They just don't get it in California


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    Default Re: They just don't get it in California

    from your link ...

    (snip)""One of the reasons that liberal societies have free markets ... is so that people can make judgments and make tradeoffs for themselves," Tom Firey, regulatory policy analyst with the libertarian Cato Institute, told Cybercast News Service.

    "In a sense, what California is doing is making the price infinite - at no price can you get the energy you need," he said. "They could claim that they are trying to give people a price break, but in a theoretical sense they're actually not - they are saying 'you can't get it at all'"(snip)



    ^^^ this proposal is also the first step towards 'energy rationing' by the state government.

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