taxes Archives - Page 2 of 26 - California Political Review

Coupal: The California Way: High taxes and government waste

December 10, 2025 By Staff 1 Comment

California’s tax burden is always a hot topic, especially now. With a state budget that is allegedly short of money (fact check: spending discipline is the only thing lacking) and multiple tax hike proposals being discussed for the 2026 ballot, voters are starting to pay attention to how much government is extracting from their pockets.

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The state’s tax troubles have resulted in the well-documented exodus out of California. The sole silver lining has been the high-tech industry which continues to produce prodigious amounts of tax revenue from stock options and capital gains by the very wealthy. But even this source of revenue is now threatened if the “billionaire’s tax” proposal starts to gain traction.

With all this focus on taxes it’s easy to forget about another problem infuriating citizens – the sheer amount of government waste. A couple of years ago, a PPIC poll found that nearly half of respondents, 48 percent, believe the state wastes “a lot” of their tax dollars, 43 percent said the state wastes “some,” and only 8 percent said the people in charge of the state government “don’t waste very much.” (Apparently, 8 percent of Californians have no access to media outlets).

What caught our attention last week was yet another story about our political leaders demonstrating gross incompetence in handling our tax dollars.

In a comprehensive investigative piece in the Sacramento Bee, reporter William Melhaydo uncovers yet another embarrassing face-plant by state government leadership. After the Camp Fire, Governor Newsom pledged to upgrade California’s antiquated 911 emergency response communications system. Toward that end, “Between 2019 and 2025, California paid four technology companies over $450 million to build out its Next Generation 911 (NG911) system, a more advanced emergency communication tool that would provide dispatchers with enhanced location services and other ways for the public to communicate with first responder operators.”

But the system didn’t work, and Cal OES decided to abandon the project and start over from scratch. Veteran political journalist Dan Walters correctly noted that the “governmental landscape is littered with information technology projects that have failed to deliver the promised benefits, have experienced huge cost overruns, or have been abandoned.”

It’s not just tech projects that have a history of waste and ineffectiveness. California’s failed “green” projects are not only wasteful, but they also frequently end up hurting the environment. One would hope that politicians would be more circumspect with expensive “green” projects after the Solyndra debacle from 2015, but apparently, that lesson never sunk in.

The Ivanpah Solar Electric Generating System is a “solar thermal plant” in the Mojave Desert that uses mirrors to heat water and generate electricity. Initially a large-scale renewable project, it is now scheduled to be decommissioned next year because it failed to meet its energy production targets, it isn’t competitive, and it kills birds by the thousands. (It also, ironically, requires natural gas in order to remain operational).

Jason Isaac, CEO of the American Energy Institute summed it up by stating that “Ivanpah stands as a testament to the waste and inefficiency of government-subsidized energy schemes.”

Click here to read the full article in the OC Register

Filed Under: Trending News Tagged With: California Politics, Gavin Newsom, taxes

Stick a Fork in California: Gov. Newsom’s Proposed Retroactive Billionaire Tax

November 25, 2025 By Katy Grimes 1 Comment

IRS Study shows California is losing a taxpayer every minute to states like Florida, Texas, and North Carolina

California Governor Gavin Newsom is pushing a retroactive billionaire tax targeting the roughly 220 billionaires residing in California in 2025, ignoring that these individuals are the most financially mobile and can live anywhere. Expecting them to remain in the state as if they will happily and willingly hand over even more of their wealth surely must be facetious.

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SEIU is sponsoring the “2026 Billionaires Tax Act.” The measure, recently listed on the Attorney General’s website, would impose a one-time 5% tax on individual wealth exceeding $1 billion, Marc Joffe wrote for the Globe this week. He explains the measure and more:

Although the tax would be levied based on 2026 net worth, it would apply to billionaires who resided in California in 2025, so theoretically it could not be avoided. Of course, billionaires are well equipped to defend themselves in court, so the constitutionality of this unprecedented tax will be rigorously tested.

Proponents assert that the measure would not cause billionaires to flee the state because of the one-time nature of the tax. Unlike federal wealth taxes floated by Bernie Sanders and Elizabeth Warren, the SEIU tax would not be applied each year.

But the flaw in this argument is obvious: if the state could impose a wealth tax once, it could do so again and again. So, yes, billionaires might well leave if this measure passes.

Why are California businesses and residents fleeing the once-Golden State in droves? We’ve asked and answered this question many times.

California has been bleeding residents and their tax revenue for many years with moves to states with no income tax or very low income tax: Florida, Texas, Arizona, Idaho, Tennessee, South Carolina, Nevada, and even Washington State.

California’s own Chevron Oil Company moved its headquarters to Houston, Texas from San Ramon, CA where it has been based since 1879, one of the biggest businesses to flee the Golden State. Chevron is in good company joining X/Twitter, Space X, Oracle, Hewlett Packard, Charles Schwab, and Toyota Motor North America, Nissei America, Inc., The Joe Rogan Experience, Gordon Ramsay North America, The Rubin Report, to name just a few of the businesses leaving California because of the state’s leftist/Marxist politics and regulatory environment.

Yet Gov. Newsom and Democrats are doubling down and still gouging taxpayers and businesses with some of the highest taxes, fees and draconian regulations in the nation.

“Despite the towering deficit, Newsom and the Democratic Party continue to spend wildly on a boondoggle bullet train and to engage in last-minute redistricting to gerrymander the state further,” Jonathan Turley writes. “They have also moved to extend Medi-Cal to illegal immigrants at a massive cost to the budget. Newsom is also pushing ahead with a Commission to pay reparations to black citizens.”

Turley reports on just how bad California is:

“A study of IRS data by the National Taxpayers Union Foundation which found that California is losing a taxpayer roughly every minute, as states like Florida, Texas, and North Carolina attract new residents due to lower taxes and higher standards of living.

In comparison, Florida gains a new taxpayer every 2 minutes and 9 seconds while Texas gains one every 2 minutes and 53 seconds.

The result has been a bonanza for Florida, which is now collecting $4 billion more per year for its budget.

The states losing taxpayers at the fastest rate are California, New York, and Illinois. Here is the rate of loss:

California: every 1 minute and 44 seconds

New York: every 2 minutes and 23 seconds

Illinois: every 6 minutes and 4 seconds.

Massachusetts: every 11 minutes and 38 seconds

New Jersey: every 14 minutes and 14 seconds.

In 2023, we asked Why Did 352 California Companies Flee to Other States in Three Years? Here’s why: Low-to-no income tax states gained $391 billion from California during 2018 to 2021, coinciding with Gavin Newsom’s election as governor.

As Economist Art Laffer and Chapman Economics Professor James Doti correctly said not long ago, Gov. “Newsom doesn’t appear to see is the deleterious long-term effects of a highly progressive tax system. Case in point: The ‘one-percenters’ who pay 50% of the tax are voting with their feet by leaving California in droves.”

They explained that the ten states with the lowest income taxes including Florida and Texas, gained a cumulative net inflow from all Adjusted Gross Income (AGI) classes of $391 billion from California during the entire 2018 to 2021 period. Note that 2018 was the final year of Democrat Governor Jerry Brown. Gov. Newsom ran for governor in 2018 and was elected. He took office January of 2019, so the 2019-2021 belongs to Gov. Gavin Newsom.

Click here to read the full article in the California Globe

Filed Under: Trending News Tagged With: billionaire tax, Gavin Newsom, taxes

On the Naughty List Again: California Ranks 48th for Worst Tax Climate in the U.S.

November 19, 2025 By Katy Grimes 1 Comment

California received the low ranking again with an ‘uncompetitive tax structure’

Having one of the highest costs of living in the country, California’s tax climate is the third-worst in the country, AGAIN, ahead of New Jersey and New York, the Tax Foundation recently reported.

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This is the 14th year California is on the naughty list – formerly known as the “Business Tax Climate Index” and this year referred to as the “2026 State Tax Competitiveness Index.”

The Tax Foundation’s State Tax Competitiveness Index enables policymakers, taxpayers, and business leaders to gauge how their states’ tax systems compare. While there are many ways to show how much state governments collect in taxes, the Index evaluates how well states structure their tax systems and provides a road map for improvement.

The 10 best states in this year’s Index are:

Wyoming
South Dakota
New Hampshire
Alaska
Florida
Montana
Texas
Tennessee
Idaho
Indiana

The absence of a major tax is a common factor among many of the top 10 states. Property taxes and unemployment insurance taxes are levied in every state, but there are several states that do without one or more of the major taxes: the corporate income tax, the individual income tax, or the sales tax. South Dakota and Wyoming have no corporate or individual income tax; Alaska and New Hampshire have no individual income or state-level sales tax; Florida, Tennessee, and Texas have no individual income tax; and Montana has no sales tax.

This does not mean, however, that a state cannot rank well while still levying all the major taxes. Idaho and Indiana, for example, levy all the major tax types, as do all the other states that rank 11^th to 16^th: North Dakota, North Carolina, Missouri, Arizona, Utah, and Michigan.

The 10 lowest-ranked, or worst, states in this year’s Index are:

Hawaii
Vermont
Massachusetts
Minnesota
Washington
Maryland
Connecticut
California
New Jersey
New York

“The states in the bottom 10 tend to have a number of issues in common: complex, nonneutral taxes with comparatively high rates,” the Tax Foundation explains. “New Jersey, for example, is hampered by some of the highest property tax burdens in the country, has the highest-rate corporate income tax in the country, and has one of the highest-rate individual income taxes. Additionally, the state has a particularly aggressive treatment of international income, levies an inheritance tax, and maintains some of the nation’s worst-structured individual income taxes.”

Competitiveness

The Tax Foundation notes that When a state imposes higher taxes than a neighboring state, businesses will cross the border to some extent, which certainly is the case of California. “Therefore, states with more competitive tax systems score well in the Index because they are best suited to generate economic growth.”

California received the low ranking again with an “uncompetitive tax structure.” “California combines high tax rates with an uncompetitive tax structure, yielding one of the worst rankings on the Index.”

California isn’t doing so well on competitiveness – the state remains static at 48th for 2025-2026 State Tax Competitiveness Index:

Click here to read the full article in the California Globe

Filed Under: Trending News Tagged With: California Politics, Gavin Newsom, taxes

Walters: California is a high-tax state. Are more taxes a balm for its budget deficits?

November 14, 2025 By Staff 1 Comment

Welcome to CalMatters, the only nonprofit newsroom devoted solely to covering statewide issues that affect all Californians. Sign up for WeeklyMatters for a Saturday morning digest of the latest news and commentary from the Golden State.

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This story is part of California Voices, a commentary forum aiming to broaden our understanding of the state and spotlight Californians directly impacted by policy or its absence. Learn more here.

California has long had the reputation — backed by copious data — of being a high-tax state, which made Gov. Gavin Newsom’s declaration last June, in a prerecorded State of the State address, a bit startling.

“Here’s the truth Republicans never tell you: California is not a high-tax state,” Newsom said.

Later he clarified his assertion, saying California’s taxes on low-income residents are relatively lower than those in red states.

“Catering to big business and the rich is also why red states tax their lowest earners far more than California does. They punish you when you’re struggling, but give you a free pass when you’re wealthy,” the governor said.

There’s some truth to that. California’s very progressive income tax system, with the nation’s highest marginal rate of 13.3%, makes its state budget highly dependent on taxing incomes of its wealthiest residents, while those in low- and moderate-income brackets pay little or no income taxes.

Nevertheless, taxes imposed by state and local governments put California in the highest ranks of the 50 states, not only in total — more than $400 billion a year from all sources — but in per capita terms — more than $10,000 each — and as a percentage of its $3.6 trillion in total personal income.

The Washington-based Tax Foundation ranks Californians’ state and local tax burden 48th, one of the highest in the nation, out-taxed only by New York and New Jersey.

“California combines high tax rates with an uncompetitive tax structure, yielding one of the worst rankings on the Index,” the Tax Foundation says.

The state’s $322 billion 2025-26 budget counts on $297 billion from about a dozen different taxes, while cities, counties, school districts and other local agencies take in another $100 billion or so, primarily from property taxes and local shares of the sales tax.

The budget anticipates $207 billion in general fund revenues. So far revenue is running a bit ahead, but general fund spending is budgeted at $226 billion. Maneuvers to cover the gap include shifting $7.1 billion from emergency reserves, pushing the June 2026 state payroll into the following fiscal year and tapping special funds for loans.

State budget experts call it a “structural deficit” that will continue indefinitely in the absence of either sharp spending reductions or tax increases.

There’s little appetite for the former in a Legislature dominated by Democrats but some support for the latter. The California Taxpayers Association recently reported that legislators proposed more than $16 billion in new taxes and fees during the recently concluded 2025 session.

Click here to read the full article in CalMatters

Filed Under: Trending News Tagged With: California Politics, Legislature, taxes

Jon Coupal: A measure to save Prop. 13 and protect you, the taxpayer

September 8, 2025 By Staff Leave a Comment

In 1978, Proposition 13 cut property taxes to one percent of the taxable value and capped increases to the taxable value to just two percent a year, with reassessment occurring only for new construction or when there is a change of ownership. It was a significant tax cut after years of inflation-driven tax hikes built up a surplus in Sacramento, while Californians were taxed out of their homes.

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Howard Jarvis, the author of Prop. 13 and our organization’s namesake, added provisions to Proposition to prevent the tax “spenders” from finding new ways to take the same amount of money from the tax “payers.”

Prop. 13 requires a two-thirds vote in both houses of the state Legislature to pass new state taxes, and it also says a two-thirds vote is needed to pass local special taxes.

But much like Howard Jarvis feared, the tax-and-spend interests have sought to destroy Proposition 13 ever since, most recently by persuading courts to carve loopholes in its constitutional protections and invent new ways for government agencies to raise revenue.

In 2017, the California Supreme Court’s decision in California Cannabis Coalition v. City of Upland created an ambiguity. It suggested that if a tax increase was placed on the ballot by a citizens’ initiative instead of by a government body, the state constitution (including Proposition 13) may not apply.

That’s why we worked with the business community last year to put the Taxpayer Protection Act on the ballot. More than a million signatures were collected. But then the governor and the legislature sued to have it taken off the ballot, and the California Supreme Court declared that the TPA was a “revision” of the constitution and removed the measure before voters could pass it.

We didn’t take that lying down. The Howard Jarvis Taxpayers Association filed a new initiative this year called the Local Taxpayer Protection Act to Save Proposition 13. This constitutional amendment will restore Prop. 13’s requirement that all local special taxes, those that dedicate the revenue to a specific purpose, must be approved by two-thirds of voters to pass. No exceptions. No loopholes.

The Local Taxpayer Protection Act to Save Proposition 13 makes clear that:

Local taxes for a special purpose require approval by two-thirds of voters to pass, even if proposed by an initiative backed by special interests.
New real estate transfer taxes (which are like sales taxes on real estate) are prohibited, except the modest 0.11% documentary transfer tax allowed prior to Proposition 13.
Existing real estate transfer taxes (including Measure ULA in the City of Los Angeles) are repealed effective December 31, 2028, except the 0.11% documentary transfer tax allowed prior to Proposition 13.

Click here to read the full article in the OC Register

Filed Under: Uncategorized Tagged With: Jon Coupal, Prop 13, taxes

What does Trump’s tax bill mean for your money? Here are the biggest impacts for Californians

July 6, 2025 By Staff 6 Comments

Congress passed its version of the massive Republican tax cut and spending bill, just ahead of President Donald Trump’s July 4 deadline, and the president signed it Friday.

The bill passed 218-214 Thursday, with Republican Reps. Thomas Massie of Kentucky and Brian Fitzpatrick of Pennsylvania voting no, along with all 212 Democrats.

An analysis from the nonpartisan Congressional Budget Office found the tax and spending bill would add at least $3.3 trillion to the federal debt over the next decade. And a CBO analysis of the House version estimated that the wealthiest American households would see a $12,000 increase in income from the legislation, and the bill would cost the poorest people $1,600 a year, mainly due to reductions in Medicaid and food assistance.

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There will be many effects felt by Americans at an individual level, including some provisions especially impactful for California and Bay Area homeowners.

Here’s what you need to know about the consumer impacts of the new bill.

Changes SALT deductions

A major point of contention for the legislation was how deductions for state and local taxes would be handled. Before the 2017 Tax Cuts and Jobs Act, homeowners could write off what they paid in state and local taxes, or SALT, from their federal tax bill. The TCJA made it so that only $10,000 of SALT could be deducted. Ever since then, Republican congressional representatives from blue states — known as SALT Republicans — have been fighting to bring it back.

The House’s initial version of SALT modifications underwent changes in the Senate. That’s the version that went back to the House and got final approval Thursday. Here’s what they landed on:

An annual cap of $40,000 in SALT deductions for households making less than $500,000 in 2025, increasing by 1% through 2029, at which point the cap would drop back down to $10,000.
The $40,000 cap would begin to phase out at $500,000, eventually dropping to a limit of $10,000.
No new limits for SALT workarounds through pass-through entities (businesses that don’t pay taxes at the corporate level and instead have the income “pass through” to the owners, who reports it on their individual tax returns), which had been included in the House’s version of the bill.
A limit on the deduction value to a 35% rate for the highest earners.
An extension of the alternative minimum tax exemption at current inflation-adjusted levels ($1.25 million in 2025) and a phase-out of the exemption at 50% at 2018 levels.

Permanently cuts corporate and marginal tax rates

Many of the tax cuts in the 2017 TCJA were set to expire in 2025. The new bill makes many of them permanent, including dropping the corporate tax rate from 35% to 21% and lowering marginal income tax rates for most tax brackets.

Click here to read the full article in the San Francisco Chronicle

Filed Under: Top Stories Tagged With: California Politics, Donald Trump, Legislature, taxes

California exploring getting rid of the gas tax, replacing it with road charge program

March 23, 2025 By Staff 2 Comments

As more drivers turn to zero-emissions vehicles, which don’t have to pay anything at the pump, California’s gas tax could soon be a thing of the past.

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The state is exploring implementing a California Road Charge, which would replace the gas tax with a mileage-based user fee for drivers who use the roads. Essentially, charging by the mile instead of the tank.

California’s gas tax is currently about 59 cents per gallon, the country’s highest rate. It generates millions of dollars to fund road repairs across the state.

According to Caltrans, Californians with gas-powered vehicles pay about $300 a year in state gas taxes.

But with a rise in electric vehicles, lawmakers are worried it won’t generate enough money.

Caltrans officials launched a pilot program in Aug. 2024 to test the road charge system. It concluded in January. The results of the program are expected to be released later this year.

Gas tax revenue is set to fall

Motor fuel taxes are the largest source of transportation revenue for states, according to the National Association of State Budget Officers’ most recent report on state expenditures. But the money they bring in has fallen: Gas taxes raised 41% of transportation revenue in fiscal year 2016, compared with roughly 36% in fiscal year 2024, the group found.

Click here to read the full article in ABC Action News

Filed Under: Top Stories Tagged With: California Politics, Gas tax, taxes

Is California living worth the costs and taxes?

December 22, 2024 By Jonathan Lansner Leave a Comment

By this math, the state is the priciest place to live

California’s seemingly lofty paychecks look relatively run-of-the-mill when considering the state’s costly lifestyle and tax burdens.

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The annual “price parity” report from the US Bureau of Economic Analysis gives us a snapshot of relative differences among the 50 states in costs and incomes. My trusty spreadsheet reviewed the latest stats for 2023, which detail how expenses squeeze California’s incomes.

Look, it comes as zero surprise that California is the priciest place to live.

The state’s cost of living is 11.2% higher than the national norm, according to BEA math. After California came New Jersey at 8.2% above average, followed by Hawaii and Washington state at 7.9% and Massachusetts at 7.6%.

Arkansas is the nation’s bargain spot, with life costing 15.6% less than the typical American’s. Mississippi is next, at 14.5% below average, South Dakota is at 13.5%, and Louisiana and Oklahoma are at 13.3%.

And how do California’s big economic rivals fare by this cost metric?

Florida was 11th most expensive, 3.4% above average. Texas had the 21st highest costs at 2.9% cheaper than the norm.

But this cost-of-living score is just one slice of the overall “affordability” equation.

Payday plus

Sky-high expenses are somewhat offset for the typical Californian thanks to their employer’s generous pay.

Ponder that the state’s per capita income in 2023 ranked sixth-highest at $81,300. The typical US income was $69,800 – 14% less.

The states with better pay than California were Massachusetts at $90,600, Connecticut at $89,900, New York at $82,300, New Jersey and Wyoming at $82,100.

At the other end of the paycheck spectrum, Mississippi had the lowest income at $49,700, followed by West Virginia ($52,800) and Alabama ($54,200), New Mexico ($55,300), and Kentucky ($55,400).

Texas was No. 24 at $66,300. Florida was No. 19 at $68,700.

The taxman

California’s incomes are also challenged by the fourth-highest tax burden, according to BEA math.

California’s effective tax cost for 2023 – that’s personal taxes paid as a share of income, per capita – was 14.9% vs. the nation’s 12.2% rate.

New York was No. 1 with 16.9%, followed by Massachusetts with 16% and Connecticut with 15.4%. Maryland was No. 5 with 14.2%.

Conversely, Mississippians pay the lowest taxes at 7.7% of income. Alaska follows at 7.9%, South Dakota at 8.1%, Oklahoma at 8.4%, and Tennessee at 8.5%.

Florida was 23rd highest at 11.3%, but Texas was eighth-lowest at 9.2%.

Bottom line

Click here to read the full article in the OC Register

Filed Under: Trending News Tagged With: Affordability, California Politics, taxes

Jon Coupal: A measure to save Prop. 13 and protect you, the taxpayer

What does Trump’s tax bill mean for your money? Here are the biggest impacts for Californians

Changes SALT deductions

Permanently cuts corporate and marginal tax rates

California exploring getting rid of the gas tax, replacing it with road charge program

Gas tax revenue is set to fall

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