Governor Arnold Schwarzenegger proposed increasing California’s base sales tax from 7.25% to 8.75% to help close an $11 billion budget shortfall. If the measure passes the state legislature, Orange County’s sales tax would be 9.25%. The measure is billed as a “temporary” increase in the sales tax, but you and I know that temporary measures tend toward permanency.
The Governator also proposes other measures, including mandatory furlough without pay for state workers, adding an oil tax (on oil pumped from the ground), and adding the sales tax to additional items, such as veterinary services and tickets to sporting events. All told, the increases in taxes is supposed to bring in $4.7 billion in new revenue. The other $6 billion or so would come from budget cuts.
Republicans in the state legislature vow to block any new tax increases. Meanwhile, Democrats likely will attempt to block any cuts in services. Welcome to a repeat of the fiasco that occurred while the legislature debated the budget back in June through September and ultimately passed a “smoke and mirrors” budget.
Will California’s political leaders actually look at what is truly needed to permanently resolve this crisis? Looking at everything the state does, eliminating duplicative programs, and drastically changing how the state gets revenue? Well, do pigs fly?