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May 22, 2009
How high tax is California
Source: Uncharted Waters: Navigating the Social and Economic Context of California’s Budget
How Does California Compare?
Revenues as a Percentage of Personal Income
Rank California US
Total State and Local Own Source (2005-06) 17 16.96% 16.29%
Total State and Local Taxes (2005-06) 13 11.73% 11.23%
State Taxes (2007-08) 13 7.57% 6.60%
Local Taxes (2005-06) 32 3.76% 4.52%
State Individual Income Tax (2007-08) 4 3.60% 2.37%
State Corporate Income Tax (2007-08) 5 0.76% 0.44%
State and Local General Sales Taxes (2005-06) 16 2.89% 2.65%
State General Sales Tax (2007-08) 26 2.06% 2.03%
State and Local Property Tax (2005-06) 36 2.67% 3.37%
State Motor Fuels Taxes (2007-08) 45 0.22% 0.31%
State Tobacco Tax (2007-08) 46 0.07% 0.14%
State Alcoholic Beverage Sales Taxes (2007-08) 41 0.02% 0.04%
Source: US Bureau of Economic Analysis and US Census Bureau
I don't understand some of these numbers. I though the California sales tax rate was 7.25% which is number 1. So that makes the two taxes generating most of the state's revenue, sales and income, among the highest in the land.
This is how the money gets spent:
| Figure 5 | |||||
| 2008-09 Budget Package General Fund Spending by Major Program Area | |||||
| (Dollars in Millions) | |||||
| Actual 2006-07 | Estimated 2007-08 | Enacted 2008-09 | Change From 2007-08 | ||
| Amount | Percent | ||||
| K-12 Education | $39,255.00 | $39,485.00 | $40,018.00 | $534.00 | 1.40% |
| Higher Education | 11190 | 11780 | 12070 | 290 | 2.5 |
| Health | 19235 | 20095 | 20705 | 610 | 3 |
| Social Services | 9777 | 9631 | 10415 | 784 | 8.1 |
| Criminal Justice | 11856 | 13186 | 13221 | 34 | 0.3 |
| Transportation | 2980 | 1416 | 1432 | 16 | 1.1 |
| Resources and Environmental Protection | 2054 | 2060 | 1912 | -148 | -7.2 |
| All other | 5066 | 5679 | 3627 | -2053 | -36.1 |
| Totals | $101,413.00 | $103,333.00 | $103,401.00 | $68.00 | 0.10% |
How has it changed over time? I was surprised to learn that most of the big increases in Real Per Capita General Fund Spending happened decades ago:
* 1959-60 to 1969-70: 8.8%
* 1969-70 to 1979-80: 6.8%
* 1979-80 to 1989-90: 0.0%
* 1989-90 to 2002-03: 1.0%
And with a high long term trend:
* 1959-60 to 2002-03: 6.1%
In fact, this chat that spending per capita is approximately flat over the last ten years
How will they fill the budget hole?
The Democrats who control the Legislature do not want major spending cuts, but so far they don't have a plan for closing the deficit. And if their solution is higher taxes and more borrowing, they will probably not have enough Republican votes to get the two-thirds approval needed for passage.California faces its day of fiscal reckoning
...
The governor's cutbacks could include ending the state's main welfare program for the poor, eliminating health coverage for about 1.5 million poor children, halting cash grants for about 77,000 college students, shortening the school year by seven days, laying off thousands of state workers and teachers, slashing money for state parks and releasing thousands of prisoners before their sentences are finished.
I predict that nothing calamitous will occur to the state as a result of these spending cuts. Anyone want to bet and propose some terms?
Posted by OneEyedMan at May 22, 2009 4:25 PM
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