California Stealin'

Discussion in 'Economics' started by Tom B, Nov 4, 2009.

  1. Tom B

    Tom B

    Will the federal government follow California?

    California Stealin'
    Sacramento demands a loan from taxpayers.

    Desperation grabs for revenue are nothing new in politics, but California is once again leading the way in creative financing.

    To help close yet another gaping budget deficit, now estimated to be $7 billion this year and reach as high as $20 billion next, Sacramento lawmakers have authorized a 10% increase in the amount of taxes withheld from worker paychecks starting November 1 and through 2010. The extra withholding tax will reduce Californians' take-home pay by about $1.7 billion for the year. But the lawmakers say this isn't a tax increase. OK, how about calling it a compulsory interest-free loan from taxpayers to the state?

    According to the Franchise Tax Board, 10,004,000 Californians overpaid their state taxes last year and received an average refund of $903. The withholding penalty is expected to snatch between $20 and $90 a month from middle-class families. For those feeling the pinch of recession and living paycheck to paycheck, that penalty will hurt.

    Of course, the government is obliged to return this money next spring when workers get their tax refunds, so this is the ultimate budget gimmick. It borrows from taxpayers now and deepens the budget hole next year. And we almost hate to ask: What happens come April if the state doesn't have enough money to pay the tax refunds it owes its citizens? Will taxpayers get IOUs the way state contractors did last year when Sacramento ran out of money?

    Meanwhile, Governor Arnold Schwarzenegger and the legislature now face their sixth "extraordinary session" to balance the budget. Income tax rates went up last year by 0.25%, bringing the top rate to 10.55%, but receipts are already coming in $1 billion below projections, according to the state controller.

    The politicians could use this continuing crisis as an opportunity to reform the state's tax code with lower rates and fewer deductions and loopholes, as recently proposed by the governor's tax reform commission. But that plan has been panned by the ruling classes in Sacramento. They claim to want to steal only from the rich, but their latest withholding ruse is showing that they'll steal from anyone with a paycheck.
  2. This is shocking.

    California needs to prepare for a lot of pain in the coming years.

    People and businesses are leaving California in droves.

    I think we are still better off then Las Vegas though
  3. Just ... LOL. :D
  4. clacy


    That is flat out theft and is disgusting.

    If you wanna take people's money, then do it the right way, out in the open by increasing taxes.

    This is a bigger slap in the face than a tax increase, IMO.

    That might be enough for me to leave the state that I'm in.
  5. I'm with Mandlebrot - I can't think of anything else to say but LOL...

    I'm glad I don't live in that fucked up state.
  6. Fuck California.

    They get what they deserve for allowing their state to be overrun with little brown criminals from Mexico. THEY ARE ILLEGALS!!! Stop paying for their food, shelter, medical, schooling, etc, etc, and stop catering to the liberal d-bags in Hollywood.
  7. you beat me to it

    what does california call anyone with any sense of fiscal responsibility? 'a racist'

    what do you call a state like that? 'bankrupt', or simply FUBAR

    frankly, i hope california goes totally BK before 'The Anointed One' can attempt to shove Amnesty down our throats

    let the country see our future if we keep headed down this runinous path
  8. I suppose one could increase the number of exemptions on their W-2 to compensate, but in any event...what the fuck?:confused:
  9. That was mentioned in the news story.. with the comment, "we hope most people don't do this".

    But as anyone due a refund is likely to get a non-neogtioable IOU from the state, the wise would "overwithhold" a bit and pay a small sum with the filing of their state return.

    Or if due a refund, allow it to be applied to next year's return and plan accordingly.
  10. Having lived in CA most of my life, I am really glad I left now. That is BS plain and simple. I didn't even know such a thing was legal. Is there precedent for crap such as this?
    #10     Nov 4, 2009