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Senate’s new tax proposal hopes to lessen state debt

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By Dominique Franklin / Staff Writer

By Dominique Franklin / Staff Writer

It takes money to make money.


This is the lesson that many learn during adolescence, and truly adapt and begin to understand as they transition into adulthood.


This philosophy is what causes so many people to invest heavily into their education.


It’s the hope that by spending the money now for a quality education, that it will give back in the future.


By spending money on education now, the goal is that the money invested will lessen the pressure of making money in the future.


The same idea that college students and parents think of is an idea that California policy makers need to adapt.


Somewhere in deliberation, “it takes money to make money” needs to be remembered as the new tax plan is created.


California finds itself once more amidst a dense debate in Sacramento about the tax plan for the next fiscal year.


Unfortunately, the political rhetoric continues as both parties hold firmly to their core beliefs.


Governor Jerry Brown has proposed a plan that mostly involves an extension of the current tax laws. Among the tax extension, taxes on income, vehicles and sales will see an increase.


According to the LA Times, the proposed tax extension will generate an estimated $11 billion through the next fiscal year.


The revenue, coupled with the recent spending cuts and an unexpected $2.3 billion increase in income receipts, will all combine to $26.6 billion by January.


That is a startling figure. So startling a figure that the revenue as a whole could potentially make California’s deficit woes a thing of the past.


Yes, California’s enormous deficit could be defeated just that easily. Unfortunately, every story needs a conflict.


The new tax plan will be no exception. In this case, Republicans refuse to vote for Brown’s proposed tax extension.


The days of not meeting the budget deadline are still fresh in the memory of many Californians.


In an effort to keep from repeating history, Democratic Senate Leader Darrell Steinberg has devised an alternative plan that may receive approval from the right.


The LA Times column sums up the Steinberg plan best. “Under Steinberg’s plan, counties and school districts will have a variety of potential taxes to choose from to raise money for services, including K-12 education.”


The taxes will of course have to be voter approved. Even still, under Steinberg’s plan the possibility of revenue from different sources grows substantially.


Since counties and school districts will make the decisions on taxes, they will have the opportunity to make the decisions for local taxes.


Taxes such as sales tax and the vehicle license fee. Taxes on liquor, tobacco, soft drinks, and oil production could all see an increase.


The new taxes however have the probability of being different in each county in California.


This snag in Steinberg’s plan is what causes many Democrats to say no.


The fact that the state government could lessen its load, and distribute more power to local counties excites Republicans, making this bill more favorable for them.


The same idea is what worries Democrats such as Allan Zaremberg, president of the California Chamber of Commerce.


Though Zaremberg strongly opposes the Steinberg plan, he acknowledges that people may immediately fall in love with it.


His concern is that “1000 school districts will be able to raise taxes limited only by someone’s imagination.” With limited state government control, this is a legitimate concern.


The bottom line is that Democrats believe there should be consistency in taxation throughout California.


Yet the plan proposed by Governor Brown is strongly opposed by Republicans.


Unless two Republicans can be persuaded to vote for the tax extension, the tax plan proposed by Steinberg may be the last remaining resort to provide funds for education and public safety.


Though he supports Brown’s tax extension, he of course mentioned that point.


Republicans have mentioned that they are waiting for pension and spending reforms. Democrats have replied by saying they are willing to deal, yet neither side has actually began the deliberations.


Though nobody likes taxes, it’s important to remember their importance.


While extending the high taxes may weigh heavy on the minds of parents, students, and other California residents, they may prove to be beneficial.


Higher taxes make it possible to provide more funding for education.


This in turn means parents don’t have to hear that their child’s teacher is going to be laid off.


It also means that college students could potentially reach a plateau of the price of education, instead of its constant climb up. More classes could be provided to both college students and K-12 students.


Statewide jobs could potentially rise as well with an increased amount of revenue.


The best part of this means that two hour wait times at the DMV will come to an end.


The possible outcomes of higher taxes are completely hypothetical, but can be a reality.


Education, public safety and state jobs are all mostly dependent on government funding, which is provided for through taxes.


An increase in taxes, if put towards the correct programs, could actually be more of a benefit for Californians than a disadvantage.


Fact of the matter is that California is in the middle of a deep deficit, and actions have to be taken.


Funding has been caught across the board, but cutting isn’t enough. Revenue has to be increased. In order for that to happen, taxes must go up.


The best bet for Californian’s is Brown’s tax extension.


Nobody will enjoy another round of high taxes, but rest assured; if we weather the coming storm, the benefits down the road will be great.


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