California voters will face several tax hikes in the coming months, with Los Angeles officials proposing a half percentage point increase to fund healthcare spending and Bay Area counties seeking similar increases to finance public transportation.
A new tax hike is being considered in Los Angeles County to offset federal health care spending cuts. The proposal would raise the sales tax rate from 10% to 10.5%. Meanwhile, voters in four Bay Area counties will decide whether to add another half percentage point to fund public transportation, while San Francisco residents will be asked for a full percentage point.
These tax hikes come as California consumers spend over $1 trillion annually on taxable goods, generating more than $70 billion in revenue for the state. However, local taxes are also high, with an average sales tax rate of 8.99% in the state.
The proposed hikes have sparked controversy, with Los Angeles County Supervisor Holly Mitchell arguing that they are needed to offset federal aid cuts. However, critics say that the increases will stifle local efforts to raise their own taxes.
In the Bay Area, the proposed transit tax measure has reignited a debate over whether public transportation systems are too dependent on unions and need to adjust to decreased ridership. Critics argue that transit officials are using scare tactics to persuade voters to support the tax increase.
California’s state law limits local add-on taxes to 2 percentage points over the statewide rate of 7.25%, but local officials often seek waivers from the Legislature, which is usually approved.
Source: https://www.smdp.com/los-angeles-and-bay-area-voters-will-decide-whether-to-hike-already-high-sales-taxes