Los Angeles officials considering a tax on real estate transactions to fund city services have switched their backing to a sales tax hike following intensive lobbying effort by the real estate.
The switch, according to the
Los Angeles Times, would "hit the working class" in the city harder.
City Administrative Officer Miguel Santana had spent six months preparing a tax on property sales before he abandoned the proposal two weeks ago. He opted instead to support a proposal by City Council president Herb Wesson that would increase the city’s sales tax by an additional half cent, which put it among the highest in the state and country.
The switch, the Times reported Tuesday, came after a fierce effort by the Los Angeles real estate lobby to kill the proposed tax on property sales. The industry showed city officials polling data that suggested voters would handedly reject the real estate measure but would support a sales tax hike.
It's estimated that Wesson’s sales tax proposal would secure $220 million a year in revenue for the city, twice as much as Santana’s real estate tax would generate.
The City Council was expected to vote later today on which tax hike plan will be place on the March 2013 ballot.
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