May 19th Elections

Let me start off by saying that I am NOT against taxes. I know that they are needed to fund a government, as taxes are the SOLE source of income for a government (despite what some people may think, money does not grow in government gardens). My contention is that tax increases are NOT the answer to EVERY government spending problem.
If your friend was constantly asking for more and more money from you to buy this thing or that and never paying you back, would you continue to give that person money? No way!! At some point you would say, no more. I say, no more, to Sacramento and to Washington DC.

May 19th you will have the opportunity to vote either FOR tax increase extensions or AGAINST tax increase extensions.

PROPOSITION 1A
When the California legislature passed the budget in March, a number of changes occurred that effect every Californian financially. First, the sales tax was increased by 1%, going from 7% to 8&. Second, the income tax was increased by 0.5% in addition to the current rate (ie from 1% to 1.5%, 2% to 2.5% etc). Third, the car registration fee was increased from 0.65 to 1.0%. Fourth, the child tax credit was reduced from $309 to $99, meaning that $210 in tax credits was eliminated (reduction in taxes due). These increases are set to expire in 1 and 2 years. If proposition 1A passes they will expire in THREE and FOUR years.

In the Sample Ballot sent out by the state of California, proposition 1A states (verbatim),
“Rainy day” budget stabilization fund- Changes the budget process. Could limit future deficits and spending by increasing the size of the state “rainy day’ fund and requiring above-average revenues to be deposited into it, for use during economic downturns and other purposes. Fiscal impact: Higher state tax revenues of roughly $16 billion from 2010-11 through 2012-13. Over time, increased amount of money in state rainy day reserve and potentially less ups and downs in state spending.

Let’s pull this apart and analyze what it says and does.
1. The Fifth word is COULD, that should tell you something right off.
2. At the end of the end of the second phrase it states “and other purposes”, what does that mean? Whatever Sacramento wants it to mean and whatever they want to fund.
3. The state has already been depositing THREE PERCENT of revenue into the “rainy day” fund. However, the legislature has raided those funds repeatedly as so there is nothing left.
4. Where does that “roughly $16 billion” in higher tax revenue come from? From taxes!! From what taxes? Those four tax increases listed above.

Here is the chart straight out of the CA budget available for your reading here (I had to mdoify the chart because of the blog template format.)

1-cent Sales Tax Increase Begins on April 1, 2009, will expire on June 30, 2010. If 1A passes it will go until June 30, 2012.

5 percent Personal Income Tax Surtax 5 (2.5% Surtax If Federal Funding Triggers is pulled) begins in Tax Year 2009 and will expire in Tax Year 2010 unless 1A passes and then it will expire in Tax Year 2012.

Personal Income Tax Dependent Credit Reduction begins in Tax Year 2009 and will expire in Tax Year 2010. If 1A passes it will expire in Tax Year 2012.

Vehicle License Fee Increase from 0.65 percent to 1 percent begins on May 19, 2009 and will expire on June 30, 2011 unless 1A passes and then it will expire on June 30, 2013.

Vehicle License Fee 0.15 percent increase (again?) begins on May 19, 2009 and will expire on June 30, 2011. If 1A passes it will expire on June 30, 2013.


How do these increases impact you? Do the math-
How many kids do you have? Multiply that by $210. Multiply that by FOUR.
How many kids do you plan on having by 2013? Multiply that by $210.
How much do you pay for car registration now? Multiply that by 1.7. Multiply that by FOUR.
The increase in income tax is harder to figure in a simple equation.
Each time you make a purchase where tax is charged, increase that by one dollar per hundred spent.

I have friends with three children. That alone will increase their taxes by $630 a year for four years. That is $2520!!! Talk about an attack on families.
Side note: I don’t know about your school district, but ours is putting a parcel tax on the ballot this year as well so not only will the state charge more for having kids, but the city is going to charge more for children