California Democrats Want to Tax Business’ Federal Tax Savings
Despite what Hollywood celebrities and Democrat bigwigs claim, California’s in bad economic shape.
Not only does California have the highest poverty rate in America—over 1 in 5 Californians live below the poverty line—but it’s home to nearly one quarter of America’s homeless people. There are so many poor people in California that it’s income inequality ratio is now larger than Mexico’s.
How could so much poverty exist in a place with nearly unlimited natural wealth, and a rich cultural and business inheritance? California is the home of Hollywood, Apple, and Google after all.
Two reasons: first, immigration—especially illegal immigration—has sucked state coffers dry, and this has translated into higher taxes for American citizens. Consider that illegal immigrants cost California’s economy over $30 billion every year. This has real impacts on citizens: it’s why, for instance, that California’s schools are some of the most crowded, and worst in America.
Second, California’s government is incompetent—the state legislature is full of rigid ideologues, and “Governor Moonbeam” is unable to grasp the magnitude of the problems facing his state. It’s to this second reason we’d like to direct your attention.
Earlier today the The San Francisco Gate, reported that California’s lawmakers are targeting the tax windfall caused by Trump’s tax reform law. Specifically, state legislators are planning to force companies to fork over half their tax savings to the state.
The Gate reports:
A proposed Assembly Constitutional Amendment by Assemblymen Kevin McCarty, D-Sacramento, and Phil Ting, D-San Francisco, would create a tax surcharge on California companies making more than $1 million so that half of their federal tax cut would instead go to programs that benefit low-income and middle-class families.
The plan makes little economic sense: not only will it deny Californian companies the benefits of a federal tax break, it sends a clear signal that California has no interest in protecting the interests of its people. Frankly, the move is greedy, and unconscionable.
But that’s not what Representative Phil Ting thinks. Defending the plan he said:
Trump’s tax reform plan was nothing more than a middle-class tax increase. . . It is unconscionable to force working families to pay the price for tax breaks and loopholes benefiting corporations and wealthy individuals. This bill will help blunt the impact of the federal tax plan on everyday Californians by protecting funding for education, affordable health care, and other core priorities.
One wonders whether or not Mr Ting is aware of the hardships that ordinary Californians are facing. Based on his words, it seems unlikely. Mr Ting, and California’s Democrats in general, govern for the coastal, liberal elites—not ordinary people.
This cash-grab is pandering in its purest form. Hopefully common sense prevails, but the odds are stacked against it in the Golden State.