There could be votes on income, sales and gas tax increases in the state Senate and Assembly as early as tonight, and the Los Angeles Times is reporting that legislative Democrats will use a complicated legal maneuver to pass them with majority votes.
Tax increases typically take a two-thirds majority, which
has held up proposals to raise revenue and cut spending to address the state's
whopping budget deficit, now estimated at $41 billion over 18 months.
A little-known and seldom-used provision of the two-thirds rule allows legislators to pass tax measures that are revenue neutral by a simple majority vote. Legislative Democrats say their plan meets that requirement, even as it pumps about $9 billion into the general fund.
How?
By taking revenue from a quarter-cent sales tax now given to local government, they trigger a quarter-cent increase for the same purpose (evidently this is a provision of the budget-balancing plan submitted to voters after the recall). Next, comes a bill to eliminate the excise and sales taxes on gasoline, which feed a special fund for transportation. But don't look for prices to fall at the pumps. A new 39-cent per gallon user fee will be created for transportation projects. User fees aren't subject to the two-thirds rule. A half-cent sales tax and a 2.5 percent income tax surcharge will raise about the same amount as the former gas taxes, making them revenue neutral and, thus, eligible to pass by a simple majority. At least that's the plan.
The plan also contains about $7 billion in spending cuts, most of it from public schools and higher education.
No word yet if Gov. Arnold Schwarzenegger will go for it.
If the taxes pass, bet on an almost immediate legal
challenge.
-- Jim Sweeney
When the cupboard is bare, the liberal rodents eat the shelves until the cupboard falls down.
The true problem, as our Governor rightly points out, is the extreme political polarization of our state. The liberal wackos want to save everybody by spending money on everything, the conservative wackos don't want to save anybody and would rather sink the ship.
We badly need reforms in California. True redistricting reform would go a long way to solving this along with the repeal of Prop 13 and a higher bar for placing initiatives on the ballot.
Yah, tell a Republican how to balance the budget, and all he'll say I'll Cut Taxes...Tell him the State is about to go bankrupt and no money is left....He'll say that he'll Cut Taxes....Public Schools about to close down, Hospitals, and Policy Officers are about to be let go....what's the Republican response...Cut Taxes. What a wasted Party. You think that by cutting taxes you are giving Joe the Plumber his hard earn money....Your crazy, your giving him Chinese Hard Earn Money...this is the greatest Ponzi Scheme Ever! Repubs you destroyed our Country.