Reporting from Sacramento -- Gov. Arnold Schwarzenegger is expected to unveil a plan today for a steep sales tax increase and deep cuts in services to wipe out a budget shortfall that is expected to swell to more than $24 billion by the middle of 2010, according to Capitol staffers with knowledge of the proposal.That would push the sales tax where I live to 9.25%. In the City of Los Angeles, the new tax would be 10.25%, include a .5% increase they just voted themselves on Tuesday. Do you think that tax would have passed if Arnold had announced this hike before the election? What do you think another 1.5% will do to Christmas shopping in California?
The linchpin of the governor's plan is the sales tax increase of 1 1/2 cents on the dollar, which could raise more than $10 billion through fiscal 2009-10. Such a tax is likely to face resistance from Republicans, who blocked a smaller increase proposed by the governor last summer and have vowed to continue to do so.
By the way, God only wants 10%.
I heard Arnold describe this sales tax hike as "temporary". That, of course, is a laugh. There's no such thing as a temporary tax in California. Once it's enacted it will never expire. Should an expiration date be included in the legislation, sometime before that date we'll be told that we cannot afford to let the tax expire and an extension will be passed. It will never go away.
Cut spending, Governor.
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