Sales Tax Hike Expires This Week!

From Katy Grimes at Calwatchdog.com:

Finally some good news! California’s 1% sales tax surcharge is set to expire Friday, July 1 making our sales tax 7.25 percent, down from 8.25 percent.
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“This is great news for overtaxed California consumers and retailers who bear the sixth highest overall tax burden in the nation,” said Runner. “In fact, all Californians have good reason to celebrate. A lower sales tax will help our state’s economy and help job creation.”

While the Legislature and Gov. Jerry Brown could pull a rabbit out of a hat and agree on a budget deal before July 1, Runner says that it’s already too late to extend the higher sales tax without causing serious confusion (the minimum amount of time necessary to notify retailers of a sales tax rate change is 15 days).

In May 2011 the Board of Equalization notified approximately 680,000 California retailers and out-of-state businesses that make sales in California that the statewide sales and use tax rate will decrease from 8.25 percent to 7.25 percent on July 1, 2011.

“Temporary taxes often have a way of sticking around—keep in mind that the 1991 ‘temporary’ 1.25% sales tax increase is still with us today,” said Runner. “It’s a good thing for California that this latest 1% tax hike goes away and stays away.”

According to a Board of Equalization estimate, California families will save an estimated $233 annually. Even so, Californians will still pay the highest statewide sales tax rate in the nation.

Well, it was almost good news.

Runner Urges Sale of Unpaid Tax Bills

From Reuters.com:

California should sell its claims to unpaid taxes to the private sector to raise money to bolster its finances, a state tax official said on Monday.
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“Selling aging debt is a common practice in the private sector and has also been used successfully by many local governments,” George Runner, a member of California’s Board of Equalization, said in a letter to Governor Jerry Brown and the legislature’s leaders.
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He estimates California agencies that collect taxes and fees have more than $20 billion in outstanding accounts receivable, either as active or written-off taxes they are owed.

If California were to sell claims to that money it would potentially have to do so at a deep discount, Runner said.

But something is better than nothing for the state’s cash-strapped government, Runner added: “You don’t get your full dollar value, but you are getting some money in the door as opposed to not getting any.”

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Read Runner’s press release

Flawed prison ruling will set felons free

As published in the Sacramento Bee:

Re “Don’t fall for scare tactics on prisons” (Editorial, May 25):

The Bee’s editorial accused me of fear mongering when I warned that the U.S. Supreme Court’s flawed decision on California prisons poses a threat to the public safety. Not true.

Gov. Jerry Brown plans to move thousands of prisoners to local jails. Unfortunately those jails don’t have the capacity to house new prisoners, and that’s unlikely to change in the short time frame provided by the court. The result will be the early release of many convicted felons with a history of serious crimes.

These felons may be labeled “nonviolent” but don’t let that fool you. Nonviolent offenders include commercial burglars, car thieves and drug dealers. Many plea-bargained to avoid tougher sentences and many have violent histories, including prior convictions for child abuse, domestic violence or assaulting a police officer.

These are bad folks. I doubt you want them in your neighborhood.

The Bee’s editorial board would have you believe that fiscal conservatives are to blame for California’s current prison problems – if those tightwads would just support higher taxes, California’s problems would be solved.

But they don’t tell you that Californians already bear the sixth highest tax burden in the nation. We already spend more per prisoner – about $50,000 a year – than any other state. Health care costs alone have soared to $18,000 per prisoner per year since the federal takeover of our prison health care system.

The court’s finding of overcrowding was based on the “design capacity” of our prisons, which assumes one prisoner per room. Most of our prisons were built with two beds per room; accordingly their operating capacity far exceeds design capacity.

Perhaps The Bee believes convicted felons should have private rooms and premium health care when many jobless Californians have neither. I don’t.

Given the outrageous costs of our current system, it shouldn’t cost a penny more to house prisoners in other locations. In fact, we should save money. But that won’t stop politicians and editorial page editors from claiming otherwise in an attempt to scare folks into supporting higher taxes.

There are solutions to reducing our prison population. For starters, we should demand that the federal government transfer the 20,000 criminal illegal aliens in our state prisons to federal prisons. After all, they’re only here because the federal government failed to safeguard our borders.

But as we look for solutions, let’s not fool ourselves into thinking a bad court decision that threatens public safety is anything other than that.

George Runner on Charter Local Edition

‘Tax the Rich’ Code for Taxing Job Creators

As published at Fox and Hounds Daily and FlashReport.org:

Years of overtaxation and overregulation have given California the second highest unemployment rate in the nation. Even so some of our state lawmakers still believe that punishing success is a recipe for job growth.

Efforts by Assemblywoman Nancy Skinner (D-Berkeley) and other Democrat legislators to increase taxes on high income earners will actually punish California job creators and worsen volatile state revenues.

According to the Tax Foundation, California already has the third highest income tax rate and one of the most progressive tax structures in the nation. The top one percent of California’s income earners have incomes of $500,000 or more per year and pay up to 50% of all income tax revenues received by the state each year, according to a report by the non-partisan Legislative Analyst’s Office.

The battle cry to ‘tax the rich’ is really code for taxing California’s job creators, including many small businesses that are struggling to survive. Rather than help California’s budget, higher taxes will reduce revenues and drive even more job creators out of our state or out of business.

The Tax Foundation also found that most small businesses pay their business taxes using individual rates, and California’s taxes on small businesses are among the most burdensome in the nation.

The California Taxpayers Association (CalTax) recently announced that Franchise Tax Board numbers show the number of Californians reporting million-dollar-plus adjusted gross incomes fell by 20.2% from 2008 to 2009. Reported income fell by 27.8% and the amount raised by the extra 1% tax on millionaires (enacted by Proposition 63 of 2004) fell 31.3%.

According to Caltax, the falling numbers are the likely result of a “combination of high-income Californians moving to states with a more friendly tax climate…and the impact of the recession on personal income.”

CalTax also noted that a taxpayer making $2 million a year can save nearly $200,000 a year simply by moving from California to Nevada.

To paraphrase Ronald Reagan, the Democrats’ 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.