HomeLatest ThreadsGreatest ThreadsForums & GroupsMy SubscriptionsMy Posts
DU Home » Latest Threads » Forums & Groups » Retired » Retired Forums » 2016 Postmortem (Forum) » California Faces a New Qu... » Reply #5

Response to UCmeNdc (Original post)

Sun May 26, 2013, 09:53 AM

5. It would be nice if this were permanent income. It is not.

 

California passed income tax increases last year, which went into effect this year. That caused a good deal of income shifting forward into the last part of 2012, in order to avoid higher 2013 taxes. The income from that started coming in to California in April of 2013 when taxpayers filed 2012 taxes. That not only inflated 2012 income tax revenue, it diminished 2013 income tax revenue.

California also raised sales tax, which pushed major purchases forward into 2012 to avoid higher 2013 sales tax. Same problem: artificially high sales tax revenue in early 2013, which will be followed by reduced sales later.

Not saying our budget position has not improved, but it's certainly not a case of "too much money." It would be stupid to start increasing spending again based on illusion of wealth that is nothing more than illusion. We also still have massive debts hidden away in pension system and in infrastructure commitments.

Reply to this post

Back to OP Alert abuse Link to post in-thread

Always highlight: 10 newest replies | Replies posted after I mark a forum
Replies to this discussion thread
Please login to view edit histories.