Tax Day hits Californians harder than most

April 15 is forever recognized by everyone as the day of the year that you settle up your “debt” with the government, if you have one. Some people have no tax liability because only 60 percent of people actually pay taxes in California. These individuals should be recognized on this day each year as the ones who are working hard for the greater societal good and the American Dream.

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Yet our government would rather look at Tax Day as Christmas and California taxpayers as individual Santa Clauses with never-ending gift bags of funds for the state. California’s personal income tax system consists of 10 brackets and a top rate of 13.3 percent. That rate ranks California as the highest in the nation among states levying an individual income tax. In 2011, our average total tax burden of 11.4 percent ranked fourth highest out of 50 states, and was well above the national average of 9.8 percent. California currently ranks 48th in the Tax Foundation’s State Business Tax Climate Index when comparing the states in five areas of taxation that impact business: corporate taxes, individual income taxes, sales taxes, unemployment insurance taxes and taxes on property. California took the most taxpayer money in the country in 2013 with $108.22 billion in tax revenues, 111.4 percent higher than the similarly populated state of Texas.

One would think that our state must be the “gold standard” in services due to the high amount of taxes flowing into Sacramento. The reality is we are ranked 46th in the nation for our education system. California drivers continue to pay the highest gas taxes in the nation, and due to Assembly Bill 32, a new fee is being added to those taxes. Further, California is ranked 47th in unemployment, a failure to every resident of our state. Given such high unemployment numbers, it is not a surprise that California has the highest rate of poverty in the nation, too.

As an investment advisor, it is my job to assist my clients in making decisions that ensure their money is working for them. Isn’t it about time that we empower Californians to insist that their tax dollars do the same? When did we settle for such mediocrity? I came to Sacramento to fight for more cost-effective policies and accountability when it comes to the spending of taxpayer money. As a representative of our taxpayers, their money needs to be invested wisely. Taxpayer dollars must be thoughtfully used to invest in our children’s education, deliver an educated future workforce and to support essential services such as public safety and our judicial system. Further, these investments should be supported by policies that incentivize business creation, job growth and economic recovery.

This legislative session, I’ve authored two common-sense bills that will ensure our taxpayer dollars are working for us and our communities. One of my bills, AB799, would create a more competitive investment climate and bring more resources to California in support of our local startup companies. Given that California’s tax structure is far less competitive than other states, investors are flocking elsewhere and taking countless jobs and capital investment with them. AB799 will move California toward becoming the best state within which to launch a startup company.

I’ve also introduced AB89, which will help local schools provide better resources and materials for our students inside the classroom by allowing schools to retain all of their funds without being forced to pay sales tax back to the state. Currently, our public schools, funded by our tax dollars, are subject to the state’s 7.5 percent sales tax which has created a “double tax” situation on our taxpayer dollars. By taxing public schools, the state is actually taking money out of our local classrooms. AB89 will fix this issue and ensure that more of our tax dollars make it into our classrooms.

President Ronald Reagan famously said “Status quo, you know, is Latin for ‘the mess we’re in.’” While we’re taking out our checkbooks this April 15, I think we should all take a cold, hard look at what we are paying into. Ultimately, it will take a more balanced representation of Republicans and Democrats in the Legislature to truly address our broken system. Until then, we can at least insist that our hard-earned money is being well invested while we continue to work toward returning fiscal responsibility to Sacramento.

Assemblyman Travis Allen, R-Huntington Beach, represents the 72nd Assembly District in the California Legislature.

Originally published online by the Orange County Register


  1. Making CA an hospitable place for business and families is antithetical to the Progressive Agenda. Anything that even hints at doing that will be 86’d by the Sacramento Mafia, as they only prosper when the state suffers and demands that the politicians do something – which translates into more graft for the insiders, and continued over-paid jobs for the Apparatchiks.

  2. Gotta Gedada Displace says

    Whether from whim or necessity, Californians who decide to ‘prematurely’ withdraw IRA funds (before 59 1/2) will find that CA adds a STATE penalty to this FEDERAL program. As if paying BOTH Federal AND State Taxes PLUS a 10% FEDERAL penalty was not enough of a dis-incentive for withdrawal, CA ADDS its OWN 2 1/2% (until recently only 1%) penalty, merely BECAUSE IT CAN! After all, you already have your checkbook open, right? Check the new proposal that widens the BASE for Sales Tax – Have they added a sales-tax deduction from Blood Plasma sales?

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