Taxpayer Victories in an Anti-Taxpayer California Legislature

CA-legislatureRonald Reagan once said, “Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” With a record $130 billion budget, we know that California state legislators are adept at all three practices, but none more so than taxes.

Democrats in Sacramento spent 2017 jamming three separate tax and fuel-cost hikes into law. They renewed the cap-and-trade program, continuing a multi-billion-dollar increase in fuel costs that brings in state revenue to fund high-speed rail. They invented a new tax on recorded documents that is supposed to fund affordable housing. And of course the SB 1 gas and car tax increase was said to be needed to fund road repair, even though billions of dollars have been diverted away from maintenance over the last decade. In the midst of an $8 billion surplus, Sacramento was steadily increasing taxes.

But fortunately, 2018 hasn’t been as dreadful for taxpayers as 2017. Here’s a sample of the proposals that, for now, have failed to pass:

Senate Bill 794 would impose a new three percent tax on fireworks at the point of sale. The abuse of illegal fireworks is a matter of statewide concern, and as such, it is totally appropriate to spend existing General Fund revenues on enforcement and safety. Instead, by taxing the sale of fireworks, Sacramento would be hurting all the non-profit organizations that raise a sizable share of their annual revenue from firework stands.

Assembly Bill 2497 would impose an as-yet-undefined tax on guns and ammunition to fund school resource counselors and police officers.

AB 2303 and AB 2560 would create a new tax of up to ten percent on small business vendors who contract out either with private prisons or with the California Department of Corrections.

Senate Bill 623 would establish a precedent-setting tax on residential water use. For now, local water agencies have joined with taxpayer advocates to vigorously fight this levy.

Assembly Bill 2486 would impose a $100 million tax on opioid manufacturers and distributors to fund prevention and treatment programs. Ultimately, this tax will be passed onto consumers, especially to patients who use opioids appropriately to manage pain. As an issue of statewide concern as well as a legitimate public health issue, opioid treatment should also be financed out of the General Fund. …

Click here to read the full article from the Riverside Press-Enterprise

How is Government Spending Hidden Tax Revenue?

tax sign​Especially in California, the word “taxpayer” is frequently preceded by the word “beleaguered.” Given our large tax burden and the tragic level of government waste, perhaps there should be a grammatical rule that these two words must always be combined.

While some California taxes are hidden, most are unfortunately and painfully obvious. But the same is not true for the level of wasteful spending by government. The unstated rule of politicians and bureaucrats is that average taxpayers must be kept in the dark about how their money is being spent.

Ask the average man or woman in the street what they think the 87 cent tax on a pack of cigarettes goes to and they will likely respond that it goes for anti-smoking programs – like those scary TV spots – and for health care.

Because of the detrimental impact of smoking on health, most Californians will agree that there seems a logical connection between what is being taxed and how the money is being spent. However, most of the tobacco tax does not go to these programs. Of the 87 cents, 50 cents goes to children’s programs administered by First Five California, a creation of Proposition 10. Now children’s programs may be a great idea, but many ask why these are not funded openly out of the state general fund instead of having the costs hidden inside the tobacco tax.

Ironically, we have seen First Five California objecting to additional taxes on tobacco products because the number of smokers might decrease and thus reduce revenue to their programs. So what we have, in effect, is an agency that is tacitly supporting what they concede is an unhealthful habit, simply because it wants the revenue.

Then there are parking tickets that in cities like Los Angeles can cost more than $60. While parking fines are imposed, in theory, to make spaces available to all motorists, the real motivation is to satisfy the appetite for revenue. Because Los Angeles has some of the highest paid workers in a state that the federal government says has the highest paid government employees in all 50 states, it desperately needs the revenue to support payroll and benefits. This may help explain some of the city’s confusing signage that makes it difficult for drivers to tell when they can park and where.

More confusion that benefits the public sector, and puts taxpayers at a disadvantage.

But state and local governments do not have a monopoly on confusing or hidden taxes, charges and other revenue enhancements.

Enter Congress and the highway bill. The version being considered by the Senate would place a new tax burden on home buyers by increasing the fees Fannie Mae and Freddie Mac charge for their loans. “Not only will it increase the cost of homeownership and make it more difficult for a buyer to purchase a home, it will hinder future efforts at mortgage finance reform,” said California Association of Realtors President Chris Kutzkey.

As bad as that sounds, it is even worse. It is another charge whose purpose is intentionally hidden from the casual observer and where there is a total disconnect between what is being taxed, home loans, and on what the money will be spent, highways. (In California this would be defined as a “special tax” under Proposition 13 and require a two-thirds vote.)

According to the Washington D.C.-based Tax Foundation, America spends more on taxes than on food, clothing and housing combined. In California, the average taxpayer works for government until May 3rd, before they start working for themselves.

It is not too much to demand from politicians that they make clear what taxpayers are being charged and on what the funds are being spent. Maybe then we can remove the modifier “beleaguered” from the word “taxpayer.”

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayerorganization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

Originally published at HJTA.org