Should it be easier for City/State gov't to access tax revenue?
Nicolas Poussin: Midas at the Source of the River Pactolus, c. 1627. Image in Public Domain
Carl DeMaio of Reform California unpacks his assertion that our State already fleeces taxpayers for every penny (highest income, sales, gas, and property taxes in America, anyone?) and accordingly shouldn't lower the required supermajority for tax hikes via ACA 1. Meanwhile, SJ's City Council voted this year to undermine Prop 13 protections via ACA 1—likely against constituents' wishes.
So what's going on in this upcoming 2024 election? Let's start there. Well, we've got a cost of living crisis. And this is something that I think most of us understand, but most voters may not understand, that their costs are really [caused by] politicians and the politicians' bad policies and negligence. Mandates, regulations obviously increase the cost of living, but so do all the fees and the taxes that are applied to almost everything that we touch. And of course, there's that ripple effect: When you raise a tax on one thing, it will have a ripple effect and raise the cost of everything.
We have the highest income tax in the country as a state, the highest sales tax. We do still have the highest property taxes for most residents because even though Prop 13 in 1978, a portion of Prop 13 dealt with property taxes and limited the assessed tax to a flat percentage and only allows it to 1% take and only a 2% increase per year, our high property values compared to other states means that we are paying a lot more in property taxes. We are not a low property tax state. We pay the highest gas tax, the highest car tax. And then there are stealth taxes applied to your bills that you don't really notice, but you've got the highest water rates in the country, the highest electricity rates in the country, the highest natural gas rates in the country. Those are all stealth taxes that are added to your utility bills and in so many other ways to everything that you buy.
The idea that government needs more money is laughable, and it's provably false. And we have to continue to remind people that we already pay the highest tax rates across the board.
Politicians are on a mission. They have always hated Prop 13 since it passed in 1978. They have always been trying to kill it. They're out there saying how little they get of our tax money, which, again, is a provable lie. But the Prop 13 initiative that Howard Jarvis authored in 1978 is, by many assessments, completely eviscerated; and I want to go through that, because when people say, “Well, at least we still have Prop 13,” well, in the past several cycles, we've lost Prop 13.
So there a couple parts of Prop 13 that Howard Jarvis put in place. The first was, he said, “Let's limit how much government can take in terms of a property tax.” [...] The other thing that's happened to Prop 13—and Prop 13 established a public vote, then Prop 218 and Prop 26 came along and strengthened these vote thresholds—there used to be a requirement that if you did a special tax and took hostages, where you say, “Oh, it's a tax increase for fire stations, it's a tax increase for police,” that when you take hostages, when you put window dressing on the ballot on a tax increase, that you should have a higher vote threshold, a two-thirds vote.
What's also interesting about the two-thirds vote is that it's also designed to acknowledge that when you earmark tax revenues and you limit the power of a governing board, that there should be a supermajority, in terms of how they spend money. And so lowering the vote thresholds from two-thirds down to a simple majority was done with the Upland case, and they're trying to do it so that politicians don't need signatures to put something on the ballot by doing it with ACA 1... (1:47–9:26)
Watch the whole thing here.
Related:
Perspective: California “has a spending problem”—so expect frequent tax bumps if ACA 1 passes
If ACA 1 & 13 pass, what seven Capital vices might prey on SJ taxpayers?
On outmigration, living standards, and (yes) taxes: What's really at stake with ACA 1?
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