In California, a Taxing Dilemma

In California, a Taxing Dilemma


Faced with trigger cuts that will further erode education, social service and infrastructure in the state, California Governor Jerry Brown filed a ballot initiative last week that would raise state income taxes on those who earn more than $500,000 a year.

This tax initiative would be in effect for five years and only impact approximately 2% of California taxpayers. More specifically, those earning more than half a million dollars per year would pay 11.3% of their income in state income taxes.

But almost all Californians would also have to contribute if this new ballot measure passes. Aside from the income tax increase on the state’s top 2% of earners, a half-cent sales tax would be imposed, which would commence in January 2013. The income tax on top earners would apply retroactively starting in January 2012. Revenues from these tax hikes would only apply to education and public safety programs.

Sound like a familiar political dilemma?

A recent USC Dornsife/LA Times poll shows that Californians support increasing taxes to pay for public education. This poll conducted between October 30 and November 9 of 1,500 registered voters in California showed that 61% favored increasing funding for the state’s public schools even if it meant raising their own taxes. 38% of those polled strongly favored tax increases to fund public schools, while 34% opposed increasing spending on public schools if it meant a tax increase.

While overall, 64% of voters favored increased spending on public schools even if it meant a tax increase, when broken down by ethnicity, people of color back increased funding more readily. 68% of Latino voters, 65% of Asian American voters, and 72% of Black voters support increased education funding in California despite the possibility of a tax increase.

For White voters, 63% of them favored the increase in public education funding even if it meant that taxes would be raised. These numbers likely reflect the age of the ethnic populations and their relative growth in the Golden State, meaning the state’s youth are more diverse than the elders.

While the economic situation in California is still tough, the fact that the state ranks
42 out of 50 in state funding per student is weighing on voters. In addition, fees at the California State and UC systems keep increasing, making higher education less accessible for working and middle class families. People feel compelled to do something to stop the bleeding from the public education system that will train the workers of the future.

Governor Brown’s newly introduced ballot initiative will likely be well received because
voters are now willing to support tax increases if the funds will be used for education. But public support for taxes on wealthier Californians to support the public schools has also been strong. Back in the spring, a poll by The Public Policy Institute of California showed that 62% of adults in the state supported higher tax on top income earners.

Some are wondering if Governor Brown is tapping into the energy of the Occupy movements in taking his tax initiative to the voters, but the public seemed to be behind this kind of “tax the rich” policy before the rallying cries of the 99% captivated the political discourse. Rick Jacobs of the Courage Campaign recently told reporters, “We know that the mood of this country and the mood of this state right now is to tax those who can pay more and who have most benefitted from the system.”

Already the anti-tax groups are lining up opposing Governor Brown’s ballot measure. Jon Coupal, president of the Howard Jarvis Taxpayers Association told NPR last week, “We do have one of the highest income tax rates already. We have the highest state sales tax. California does not have a revenue problem, but it has a spending problem.”

Going into 2012 with strong support in California for the funding of public education and solid support for taxing the state’s wealthy, it will be interesting to see if groups push the Governor to go bigger in his proposal or what other kinds of revenue generating proposals will gain traction. One thing to be on the lookout for would be various ways to reform the ever controversial Proposition 13.

— Daily Grito


  1. Reduce the costs of higher education at University of California: then fund UC. UC Berkeley Chancellor Birgeneau ($450,000 salary) dismissed many needed cost-cutting options. Birgeneau did not consider freezing vacant faculty positions, increasing class size, requiring faculty to teach more classes, doubling the time between sabbaticals, freezing pay & benefits, reforming pensions & health benefits.
    Birgeneau said such faculty reforms would not be healthy for Cal. Exodus of faculty, administrators: who can afford them?
    We agree it is far from the ideal situation. Birgeneau cannot expect to do business as usual: raising tuition; granting pay raises & huge bonuses during a weak economy that has sapped state revenues & individual income.
    We must act. Chancellor Birgeneau’s campus police deployed violent baton jabs on students protesting increases in tuition. The sky above UC will not fall when Birgeneau ($450,000 salary) is ousted.

    Email opinions to the UC Board of Regents