Brown Administration to Submit Tax-hike Initiative

Thursday, 01 Dec 2011 03:32 PM

 

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SACRAMENTO, Calif. (AP) — Facing another budget deficit and the prospect of deep cuts to education, Gov. Jerry Brown plans to file a ballot initiative as early as Friday that asks voters to increase taxes on the wealthy and raise the sales tax by half a cent.

The initiative would be intended for the November ballot and would maintain a pledge Brown made during his 2010 gubernatorial race not to raise taxes without a vote of people.

His plan was initially reported by The Los Angeles Times, which cited sources with direct knowledge of it.

A legislative source who had been briefed on the proposal but was not authorized to speak publicly told The Associated Press on Thursday that the initiative would call for adding an extra 1 percent tax on individuals earning more than $250,000 a year.

Individuals making between $300,000 and $500,000 would be taxed an additional 1.5 percent, while those making more than $500,000 would be taxed another 2 percent.

The combination of income and sales tax hikes would raise about $7 billion and expire in 2016.

The governor's spokesman, Gil Duran, declined comment. Brown's political adviser, Steve Glazer, would not confirm that the administration was ready to submit the language for a ballot proposal but said the approach fits with the governor's budget philosophy.

"The governor continues to promote a balanced solution to the state budget that combines difficult cuts and efficiencies with adequate revenue that protects schools and public safety," he told the AP.

California is facing a projected $13 billion shortfall over the next 18 months. With tax revenue running behind projections, the budget passed last summer calls for automatic spending cuts after the first of the new year to higher education, public schools and some social services.

Brown, a Democrat, has been developing his tax plan in a series of closed-door meetings with his staff, labor leaders and Democratic lawmakers. He has argued since taking office that raising taxes is necessary in order to prevent further cuts to essential services such as public safety and schools.

Earlier this year, Republicans blocked his effort to place a measure on the ballot as part of budget negotiations.

California has cut tens of billions of dollars in state spending since the recession began in late 2007 and sent tax revenue plunging. The state general fund this fiscal year is $86 billion, down from $103 billion before the recession.

The additional revenue from the temporary taxes Brown proposes would be directed toward schools, which would in turn free money for other services.

The initiative's prospects at the polls will be far from certain if it qualifies for the ballot. The recession has thrown millions of Californians out of work, and several other groups also are planning tax-related initiatives, creating a logjam of confusing proposals.

One, for example, seeks to close a corporate tax loophole while another seeks to raise income taxes to generate $10 billion for schools.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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