Soaking the rich - Burton seeks tax hike on so-called wealthy

Union-Tribune ^ | January 15, 2004 | Union-Tribune Editorial

[calcowgirl]

'We have people making half a million a year after deductions, taxable income. If you have to come up with another two, three or four hundred dollars, you can afford it. Basically, what people would be paying for is a just society."

That's the world according to Senate President Pro Tem John Burton, D-San Francisco. He suggests wealthier Californians are contributing too little to the state treasury. He proposes that the Legislature slap them with higher taxes, rather than accept Gov. Arnold Schwarzenegger's proposed spending cuts.

But the notion advanced by Burton that the state's higher-income residents are not paying their fair share of taxes is just a canard. It is part of a cynical ploy to build public support for higher taxes, rather than budget cuts, allowing Burton and his fellow Democrats to continue spending money the state does not have.

The fact is, higher-income Californians pay a disproportionate share of the state's bills. Indeed, while residents with adjusted gross incomes of $100,000 or more constituted only 11 percent of tax returns in 2001, according to a recent report by the Franchise Tax Board, they accounted for a full 75 percent of the state's income tax revenue.

And as to those making a half-million dollars or more, for whom Burton seems to have so much contempt, they accounted for less than 1 percent of returns in 2001, yet they paid a whopping 34 percent of the state's income taxes.

The Senate Democrat leader, whom The San Jose Mercury News characterized this week as "the Legislature's most outspoken liberal," flippantly suggests that those earning $500,000 a year or more could easily afford another $200 or $300 or $400 in taxes.

The implication is that those 80,000 or so taxpayers do not work as hard to earn their money as Californians further down the income scale. Thus, it is OK for the state to jack up their tax rates, to hit them up for an extra $2 billion to $3 billion a year.

But most of those whom Burton has targeted for tax hikes are not members of the proverbial "idle rich." Most do not owe their yearly incomes to inheritances or lottery winnings or some other windfall. In fact, many are small business owners who pay taxes not through the corporate income tax, but through the personal income tax.

So when Burton and other tax-and-spend Democrats propose to sock it to those making "half a million a year," to pay for Burton's so-called "just society," they really are talking about hiking taxes on small businesses – as if the cost of doing business in California isn't already high enough.

The perverse thing of it all is that the Burton tax hike almost certainly would yield less revenue than he expects. Indeed, in 1991, the Legislature added 10 percent and 11 percent tax brackets for upper-income filers on a temporary basis, expecting to generate $1.2 billion a year in additional revenue. As it turned out, collections were little more than half that.

It is for Burton to make a solid economic case for a tax hike on California's wealthy. That is why he is resorting to class warfare rhetoric to sell his proposal.

[pacpam]

The 'rich' are too few in number to outvote those who seek to take their money with the ruse - they don't need it. This is the beginning of the failure of democracy if the trend continues.

[Guillermo]

...you can afford it...

I love it when politicians determine what others can afford, what others need, etc.

[Guillermo]

Democracy = 2 wolves and a sheep voting on what's for lunch.

[.cnI redruM]

A state tax hike on the rich. That would be stupid. Raising taxes on the people who can most easily pull up stakes and leave is a great way to guarantee reduced results.

[.cnI redruM]

I meant to say reduced revenues.

[kingu]

Hey Burton! Here's a guy who's got plenty of bucks to burn for no good reason, and he likes giving it to RATs. Why don't you hit him up for a few billion?



And when you're done with the Soros Tax Initative, how about making the Peter Buffett Property Tax Adjustment? He seems to think that he's not charged enough, and he's got plenty of bucks to share. Really, Burton, why tick off those who are running small businesses when you got so many wonderful targets who are just eager to part with their money?

[SF Republican]

Burton is a real sweetheart; when Arnold went to meet everyone in Sacramento after the election, Burton gave him a cigar lighter that flips the finger.

[FreedomSurge]

I believe there ought to be a tax on the wealth of the super rich. The Ford family, Bill Gates, George Soros, Warrent Buffet et al. They are uniformly democrats.

The Democrates are the party of the super rich and those on the dole. The US should highly tax super wealth.

[Amerigomag]

Burton is absolutely disingenuous. He realizes that practical raises in income tax rates for the wealthy or any other sector of the populous, for that matter, will not solve California's problems.

As I just pointed out on another thread, Burton would have to raise rates 40% across the board to meet current spending levels and resolve the accumulated debt. He'd have to almost triple the rates of the "wealthy" to achieve the same goals.

Burton knows this is not practical. He would collapse the California economy.

[yankeedame]

That would be stupid. Raising taxes on the people who can most easily pull up stakes and leave is a great way to guarantee reduced results.

Amen! Just ask any major US city.

[vannrox]

[goldstategop]

Make the uber rich socialists pay more! I want to see taxes ramped up on them so they never come back to California!

[Righty1]

What could you expect of "our" first "hispanic" state. Look at Argentina, Venezuela, Mexico, and etc. Whenever hispanic peasants get the vote they immediately loot the treasury and kill the goose!

[pacpam]

When those we send to represent us act like it is a democracy, it doesn't mean much that we are a republic.

[Consort]

Sounds like Democrat Trickle Down Taxes to me: When liberals raise taxes on the rich, the rich get richer and the poor and middle classes get poorer. The rich pass higher taxes down on you and me by raising prices for goods and services that they produce. The higher prices make them more than enough to pay the higher tax -- and they pocket the rest, thereby widening the gap between rich and poor. And the higher prices we pay automatically include higher state and local taxes, as well, since they are a percentage of the price. The rich and the government get more money as a result. The poor and middle classes get double whammied in the process.

[Myrddin]

I believe there ought to be a tax on the wealth of the super rich.

Great idea. We'll start by visiting your house first. We need 50% of your wealth to meet our needs.

[FreedomSurge]

No need to visist my house as I am not part of the super rich. However can you name a billionaire who is not a liberal democrat? Both Gates and Buffett testified against the removal of the inheritance tax. Why? So that owners of closely held companies worth maybe $10 million dollars a year but cash flowing 200 to 400k per year have to sell their businesses at distressed rates in order to pay the tax.

No don't come to my house, go to the houses of the super wealthy first. (by the way the concept of super wealthy is different that high income.)