Fighting Forward: Beyond Proposition 13

Proposition 13 is not the only problem with California’s tax system, and split roll is not the only needed fix. The California Tax Reform Association (CTRA) proposes dozens of ways (nearly all progressive ones) for California to tap $13-17 billion of new revenue annually, or double that amount when federal matching grants are factored in.

One group of recommendations concerns tax collection, such as improving the collection of business use taxes and cracking down on abusive tax shelters. Another set of proposals eliminates “money for nothing,” mostly from corporate tax loopholes, including a series of new ones passed since last September potentially costing $2.5 billion.

It also lists a potential $1 billion from an oil severance tax of 9.9% that Governor Schwarzenegger once proposed but promised to veto if it showed up in this year’s budget package.  California is the only oil producing state without such a tax. (In 2007 Sarah Palin approved an increase in Alaska’s oil severance tax to 25%. )

Finally CTRA points to taxes supported by the public, including the reinstatement of the top income tax bracket to its early 1990s level. (Since 1993 California’s richest 1% has nearly doubled its share all income in the state.)  That correction alone would generate $3-5 billion yearly.

Next: Finding Allies in a Fight Back