Californians voted to increase taxes yesterday by passing Proposition 30. The measure raises taxes on the wealthy and hikes the state sales tax.
Democrats also gained a two-thirds majority in the California Senate, giving them the ability to pass tax increases and take other steps without the need for Republican votes.
CNN Money reported:
Californians approved a measure Tuesday that raises taxes on the wealthy and hikes the state sales tax. It is expected to bring in $6 billion a year, on average, over five years.
Proposition 30, which Governor Jerry Brown has lobbied heavily for, captured 54% of the vote. Its approval prevents massive budget cuts to the state’s public schools and universities.
Brown built the tax hike into his budget so its passage was critical. Among the hardest hit by the Great Recession, California has had to slash billions of dollars from its budget in recent years to close yawning deficits.
Taking a gamble, Brown went directly to the people with the tax measure this year after losing a battle with Republican lawmakers in 2011 to put the increase before voters.
The measure creates three new personal income tax brackets for rich residents and adds a quarter-cent to the sales tax. The higher tax rates, which hit single filers making $250,000 and up and married taxpayers earning at least $500,000, last for seven years, and push the top tax rate to 12.3% for filers earning $500,000 and above, or $1 million per couple.
The sales tax hike, which brings that levy to 7.5%, lasts for four years.
The tax increases cannot be changed or extended without voter approval.
Salon is very excited about the California results and sees great prosperity ahead for the Golden State.