Wednesday, October 5, 2022
Home CALIFORNIA Conveniently timed checks set to go out

Conveniently timed checks set to go out

 

What a coincidence.

The checks for California’s “Middle Class Tax Refund” will start hitting mailboxes in early October. Just before the Nov. 8 election.

Could the checks have gone out earlier?

Well, just last year similar refund checks started being sent out in late August. Just before the failed Sept. 14 election to recall Gov. Gavin Newsom.

No doubt another coincidence.

The checks are supposed to be for inflation relief, especially for gas prices nearly doubling at the pump. But the Democratic supermajority in the Legislature rejected Republican proposals to give direct relief to drivers by suspending the state’s gas tax of 51 cents a gallon. Instead, an increase of 3 cents was allowed to go into effect on July 1.

Gas taxes especially hit hard the poor and the middle-class, who often suffer long commutes to expensive coastal areas from cheaper inland bedroom communities.

The refund checks will total about $9.5 billion, or 10% of this year’s surplus.

That’s also paltry considering the hard work California taxpayers put in keeping the economy afloat during the pandemic.

More fair would have been to send all the money back to those who earned it in the first place.

Newsom and the Legislature also could have used the surplus to transition to a more sensible tax code, such as a flat tax on income.

Almost everyone concedes the complex, highly progressive state tax code drives away the wealthy, who take their businesses with them.

Obviously many millionaires still live here, but in recessions, such as the one we’re plunging into, their stock portfolios go down, drying up all that extra tax money that goes to the state.

The top half of 1% of state taxpayers pay 40% of all state income taxes. A sensible reform would encourage them to stay and pay, not drive them away.

Well, it’s still good news 23 million California taxpayers will get some of their money back.

Direct deposits or debit cards of up to $1,050 per family, with most being $350, are welcome no matter what. But a real chance at reform was lost.

 



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