Schwarzenegger wants 9.25% sales tax in O.C.
November 6th, 2008, 11:46 am · 190 Comments · posted by Jon Lansner/ocregister.com
Gov. Arnold Schwarzenegger today announced a financial rescue package for the state government that includes a 1.5 percentage point hike in the state retail tax that would take Orange County’s sales tax rate to 9.25%. (The state would get 6.5%.) The fresh cash is needed to backfill an $11 billion deficit in this year’s budget
Overall, Arnold is proposing $4.5 billion in difficult cuts and $4.4 billion in new revenues for the current year budget. He called a special session of the legislature to handle the funding crisis.
According to the governor’s plan, the higher sales tax would end in three years. Other planned tax hikes:
- Sales tax applies to the repair of appliance, furniture and vehicles plus golf and veterinarian services. One Orange County vet called it “devastating” as an auto-repair shop owner calls it “bizarre.” More reaction IS HERE!
- Sales tax will be applied to amusement parks and sporting events. O.C. industry reaction IS HERE!
- Alcohol excise taxes are proposed to be raised by five cents a drink.
- $12 increase in annual vehicle registration fees.
- Press release IS HERE! For an at-a-glance fact sheet of the proposal, CLICK HERE.
Hezy Shaked, CEO of the Irvine-based Tilly’s clothing chain, had this to say: “In this tough economy, any increase in price to the consumer is going to be devastating.” (MORE HERE!)
Budget cuts and economic incentives in the plan include, according to the Sacramento Bee:
- One-day-a-month unpaid furloughs for state workers for the next 17 months, as well as rescinding two of the workers’ 13 paid holidays.
- Cutting spending on programs in the current budget by $4.5 billion, $2.5 billion of it from elementary and high schools.
- Revamping the state’s cash-strapped unemployment insurance system by gradually increasing the rates charged to employers and lowering benefits while tightening eligibility requirements.
- Relaxing some state labor regulations dealing with meal and rest periods, overtime exemptions and work schedules.
- Speeding up public works projects, especially hospital construction, to inject life into the state economy. That would require modifying some environmental regulations.
“In the six weeks since I signed our last budget the mortgage crisis has deepened, unemployment has increased and the stock market has lost almost 20 percent of its value,” Schwarzenegger said. “We have drastic problems that require drastic and immediate action — we must stop the bleeding right now.”
- Another problem: The state may not be able to borrow more money this year. (MORE HERE!)
- The governor, a Republican, may have trouble with his own party getting his plan approved, the Associated Press reports:
Democrats already have called for tax increases, but Republicans have adamantly refused them. That complicates efforts to get a deal because some Republican votes are needed in the Senate and Assembly to reach the two-thirds majority required to pass spending plans and tax increases. State Sen. George Runner, the Senate’s GOP caucus chairman, flatly said that Republicans will not support a general tax increase. “The fact is that during this time of economic challenges is not the time to go back to California taxpayers and ask for more money from them,” said Runner, of Lancaster. (MORE HERE)
- Not all reaction was glum. At least one economist — Jane V. Hall at Cal State Fullerton — thinks some of the targeted spending could boost jobs. (MORE HERE!)
November 6th, 2008 at 12:08 pm
i don’t like this. but with the state budget the way it is. i say go ahead arnold.
November 6th, 2008 at 12:11 pm
this is bull terds.
November 6th, 2008 at 12:11 pm
just think of what the republicans reaction would have been if the governor was a democrat.
November 6th, 2008 at 12:12 pm
He played Conan the Barbarian, thinks he is King Richard but really has become the court jester - Arnold the fool.
November 6th, 2008 at 12:14 pm
Wow. Arnold is really officially worse as a the governator then as an actor in his movies. WE NEED TO CUT SPENDING NOT RAISE TAXES. It ’s not a tumor is just common sense. Let him run for the Senate, No way is he getting my vote and I voted for Obama.
November 6th, 2008 at 12:15 pm
Good God. Is this what it’s come to?
November 6th, 2008 at 12:19 pm
Gov. Schwarzegger is a joke. As a state, we already have the highest taxes in the nation and he wants to raise them even more?? He’s doing this to cover his ass because he does not know how to manage a budget.
We must be fools for voting for such a fool.
And why does he only want to raise the taxes in the OC?
November 6th, 2008 at 12:20 pm
The problem with this “temporary” sales tax hike is that it will become permanent just like it did in L.A. OC’s unemployment rate is going up as so are our sales taxes….nice going Arnold!
November 6th, 2008 at 12:20 pm
This is rediculous, and shows how COMPLETELY out of touch Arnold is with both the economy AND his State!!! I’m struggling as it is, and I make a decent salary. I can’t even imagine how it’s going to effect those who make less than I. I pray this gets stopped!!!
November 6th, 2008 at 12:21 pm
According to the McCain / Palin logic isn’t this Socialism????? Hypocrites…
November 6th, 2008 at 12:23 pm
According to McCain / Palin logic, isn’t this socialism??
Hypocrites!
November 6th, 2008 at 12:23 pm
not during these trying times…it will kill all the mom and pop shops…the more people would stop buying…
November 6th, 2008 at 12:24 pm
NO! There are better ways to solve this financial crisis.
You cannot add fuel to the fire like the Fed is doing, That only increases future debt and exasperates the entire economic mess.
You also cannot pass the burden along to those who can least afford it. Higher taxes will only reduce public expenditure thus negating any overall stimulus.
The work begins at home Arnold. Cut the bureaucracy first! Eliminate 25% of the current wasteful pork barrel government expenditure. Don’t touch the schools or health care though.
Side note: Do we really need two separate state funded universities ie CalState and U of C? MERGE them! And cut your expenses that way.
There are too many overlapping social, education and health care related programs. Eliminating the duplication of effort would go a long way into solving the current problems.
November 6th, 2008 at 12:25 pm
NO ONE CAN AFFORD THIS!! Consumer spending is already at its lowest levels EVER!! WTF?
November 6th, 2008 at 12:25 pm
He lacks discipline! with spending that is.
November 6th, 2008 at 12:28 pm
First off there is no such thing as a ‘temporary’ tax. It will be permanent. When prices for gas, food etc. started going up, I cut back on things. I didn’t go in to my boss and ask for a raise to compensate for the increase in prices. The state needs to cut back, period. Our current taxes are being mismanaged, so this would just be more money for the political hacks to waste.
November 6th, 2008 at 12:29 pm
Thanks Arnold, I just won’t buy anything. How bout cutting some expenses first. The state is way to big. They should be funding only the necessities.
November 6th, 2008 at 12:32 pm
I have a headache. It might be a tumor. It’s not a tumor! I am a cop you idiot.
November 6th, 2008 at 12:35 pm
Raise taxes to stimulate the economy?? Sounds like Arnold my have missed an econ class or two… what a joke.
You never raise taxes in a recession. A budget deficit in a recession is not an immediate concern.
Deficits are typically a problem for two reasons (1) they can create inflationary pressure (2) they can cause interest rates to rise due to increased demand for public credit.
In a recession, the economy is operating below peak production, so the increase in aggregate demand is met with increased production rather than higher prices (a good thing). And with the Fed acting simulatneously to lower interst rates, item (2) becomes a non-issue.
Worry about the deficit when the economy is healthy. For now, cut taxes and let the deficit remain.
November 6th, 2008 at 12:37 pm
All of you airhead continue to forget, it is not the Governor that we need to be upset with over spending, it is the Assembly. They set the budget. We also blame the Governor or the President and forget who is passing the budget! We got rid of Davis now you want to get rid of Arnold. Until you get rid of the Assembly you will get more of the same.
November 6th, 2008 at 12:38 pm
The great fallacy of government is that it operates efficiently which couldn’t be further from the truth. No one in government believes otherwise which is why the largest recipient of tax dollars (education) scream that there’s no more to cut. As I understand it, the schools are being asked to cut $4B which they don’t want to do however, harsh reality is setting in.
Raising the sales tax doesn’t not lend itself to long term prosperity. If it did why not raise the rate to 10 or 20 percent and the coffers would be overflowing.
It is uncontroverted that Arnold is an effective governor and he hasn’t achieved notable success except for the DMV fee rollback. Sad when he had plenty of chances and didn’t take on the challenge under the misguided belief that he could be friends with the Democrats and still accomplish much. Will he have the fortitude to tell the schools and unions that they must accept funding cuts? Will the Democratic leaders accept it and tell their constituents? I doubt it.
CA is locked into functional disarray and there’s nothing on the horizon that encourages me to believe otherwise.
Sacramento has messed things up again and now we’re going to have to bail ourselves out. I would give some limited consideration to a 1 percent increase that sunsets in 2 years with an accompanying law that says it’ll be reduced 1.5 percent at that time. This would only be slightly palatable if 3/4 of the projected deficits were made up with tax cuts.
November 6th, 2008 at 12:39 pm
if you raise the sales tax, people will buy less… if they buy less, the small shops they bought from go out of business… if they go out of business, jobs are lost… if jobs are lost, unemployment goes up…. uh, that would be the definition of a democratic idea. Let’s tax everyone and then watch everyone spend less…. arnold is not a real republican…..
November 6th, 2008 at 12:42 pm
This sales tax will only feed the hungry mouths of the liberal California legislature and encourage them to continue spending. We need to stop this exessive spending!
If this passes, we would be paying for the governments poor budget planning. The government does not manage money well, so why would we give them more?
November 6th, 2008 at 12:45 pm
terminate him.
November 6th, 2008 at 12:46 pm
RECALL ARNOLD ‘09. This is not Germany or Austria with all the taxes and SOCIALISTS running the place. Cut spending! Cut back on government law makers in Sacramento. CUT PENSIONS NOW. Use the old Grandfather clause to do it.
POWER TO THE PEOPLE. It is time to FIGHT BACK!!!
November 6th, 2008 at 12:49 pm
Unbelieveable. Add this to what Obama wants to tax my family and we might as well sell our small business and move to tent in the NV desert.
November 6th, 2008 at 12:49 pm
We voted against a “temporary” tax increase after OC was in a big deficit, and guess what, we had a surplus a short time later. I hope we can vote on this nonsence again. When are you people going to stop voting for Democrats who tax and spend ?
November 6th, 2008 at 12:49 pm
SUE ARNOLD for discrimination against OC. Any lawyers out there???
November 6th, 2008 at 12:51 pm
We should take up a collection and buy Arnold a strap-on pair.
He hasn’t been the guy I voted for in quite a while.
November 6th, 2008 at 12:53 pm
Is this the same Arnold who quoted our lame duck prez Bush when he was campaigning and told all of us ‘NO NEW TAXES’ ? What a rip off, Arnold! Had I known it would come to this, I would have voted for the other guy. Take some responsibility for your out-of-control spending!
November 6th, 2008 at 12:53 pm
I think this might be the end to his political career, your kidding me right? 9.25%?? We voted out the last governor for trying to triple the DMV fees (Davis) and I think we should do the same for this guy. Too bad his career in acting is toast as well…
November 6th, 2008 at 12:54 pm
Just wait for Obama’s tax hikes on top of this idiotic proposal…
November 6th, 2008 at 12:55 pm
Arnold- WE need to TERMINATE YOU !!!
Is this the CHANGE we were promissed ?
November 6th, 2008 at 12:55 pm
t Said:
When are you people going to stop voting for Democrats who tax and spend ?
uh duh? You know the Gobernator is a Republican right?
November 6th, 2008 at 12:57 pm
chalk up several more reasons to leave this state..
November 6th, 2008 at 12:58 pm
We are foolish if we are suprised by this. With Tuesdays passage of seemingly every darn tax and bond initiative on the ballot, our inept and overspending legislature and our continuation of the two party system that continues fail at putting moderation into one or the other extreme party category, our ineffective governor had no choice. This is only the beginning.
November 6th, 2008 at 12:59 pm
NO NO NO NO NO NO NO, I said ((((( NO )))))
Cut the Governments Salaries and Spending.
Look how they live, it’s ridiculous!
I am poor, I can’t afford anymore taxes.
I can barely pay the ones I have now.
Oh, never mind, maybe I can just die now.
I’m done.
November 6th, 2008 at 1:00 pm
Wow, not a good sign…. almost a 10% sales tax… that along with a 7+% income tax in California coupled with Federal Withholding and it makes you wonder. Imagine paying almost 10% of a car’s value just to buy it in the State of California. So, if I buy a $ 25k Toyota, I have to pay almost $2,500 just to buy it in the State of California.. Wow on that !
The radical democrats keep electing people who think that the middle class is just soaked with money and would gladly just give it away for program after program, entitlement after entitlement…. we are about at the point where the average taxpayer is just going to say…. “sorry, I just can’t afford to pay the tax” and just hunker down and not buy anything….
Here’s an idea…. gosh, cut spending….
Counting on the remnant of Republicans in the California Assembly to be stalwart in their opposition….
c
November 6th, 2008 at 1:00 pm
NOOO!!!!
I don’t agree with this. Not everyone in the OC is rich!
November 6th, 2008 at 1:03 pm
Hey Arnold, the problem is not a budget shortfall. It’s the overspending by your office and the Assembly. You and Fabian Nunez need to stop flying private jets! What happen to cutting all the credit cards in Sacramento?
November 6th, 2008 at 1:04 pm
Amazing!!! What is happening in this state, is just a precursor to what is going to happen at the federal level! Start writing to your state assembly members and senators. We are going to bk ourselves! Get rid of the Illegals and social programs!
http://www.legislature.ca.gov/legislators_and_districts/districts/districts.html
November 6th, 2008 at 1:04 pm
This is just getting ridiculous. I remember when sales taxt was 6% and everything was just fine. Every time there’s a crisis the solution is let’s raise taxes. If we continue on this route sales tax will be 30% in another 30 years.
Arnold, here’s the solution. DONT SPEND MONEY YOU DON’T HAVE!!!!. Could it be any more simple?
November 6th, 2008 at 1:04 pm
Oh Mike, Schwarzenegger is a Republican in name only - his actions are all Democrat.
November 6th, 2008 at 1:04 pm
Where’s Gray Davis when we need him?!?!
November 6th, 2008 at 1:04 pm
Jimmy - the Governor doesn’t spend our tax money, we have a
wonderful legislature (D) doing that.
November 6th, 2008 at 1:07 pm
It’s okay, I’ll just pay the tax increase with the check Obama is going to be sending me in the mail. I didn’t get it yesterday, but I’ll check again today!
November 6th, 2008 at 1:09 pm
Why is everyone picking on OC? First we’re all anti-gay, religious fanatics and now we’re all supposed to be rich. Somebody forgot to tell me. Maybe I should move, I apparently don’t belong.
November 6th, 2008 at 1:09 pm
OMG what the hell is going on? Seriously do they think that we are pooping money? Yeah not everyone in the O.C is rich! This is just insane! People are losing there jobs, the economy is going down and now this!
November 6th, 2008 at 1:10 pm
This is what happens when we elect an actor to run the state. He needs to say here’s my paycheck until we can get thru this money crunch
November 6th, 2008 at 1:11 pm
He can want in one hand & s**t in the other… .05% is about all he will get.
November 6th, 2008 at 1:11 pm
Arnold:
How does it feel to want? If you did a better job of controlling expenditures, this wouldnt be an issue. So again, how does it feel to want?
November 6th, 2008 at 1:13 pm
Here we go! This is just the start and there will be no where to hide your money. Thanks liberals for bankrupting this once Great State.
November 6th, 2008 at 1:14 pm
Impeach Him !
November 6th, 2008 at 1:17 pm
No more Taxes, that’s a lot of bull. We all pay to many taxes as it is. Give us a break! I agree with Eliz, who said .05% ia all he will get, that’s good enough for me. Arnold, read that papers buddy, were in a recession.
November 6th, 2008 at 1:17 pm
1) More taxes=less revenue 2) Less taxes=more revenue 3) California Governor=Maria Shriver 4) Mr.Mom=Arnold Schwarzenegger 5) California Citizens=Broke, Unemployed, Suckers
November 6th, 2008 at 1:17 pm
Arnold is the same guy who told us on the Jay Leno Show 5 years ago that Californians are overtaxed and that he was going to be the ‘people’s governor’ and cut spending in Sacramento! No more taxes! Now he wants to add to your tax burden by adding a record $0.015 tax increase to whatever you purchase! This means that with the recent ballot sales tax increase, the Los Angeles sales tax will go over 10%! Arnold lied to you, folks. Doesn’t it matter when a governor lies to you anymore? He signed all the previous budgets and encouraged the out-of-control spending in Sacramento and now he wasts to punish YOU for Sacramento’s irresponsible spending habits! Heck, we spend $10 BILLION tax dollars a year in California to support illegal foreigners. Why doesn’t Arnold address THAT issue? No, he wants to hose you instead!
November 6th, 2008 at 1:17 pm
Don’t blame the governor or the state assembly. Blame the people that allowed all the illegal’s here to begin with. You wanted cheap labor to pick your fruit and now they are here to stay with their children as legals. They all need medical care, food and everything else it takes to live. You wanted them here- you got em. Bob
November 6th, 2008 at 1:18 pm
There, apparenlty, are not too many bright readers of this newspaper. The Tax applies to the entire state, not just OC. But any way, it is astounding that this leap from the balanced budget he approved in late September a to 11.2 billion deficit occurred in ONLY six weeks! Amazing, folks. It just snuck-up on him, I geuss. And, he wants to fix the problem with 4.4 B in new revenue and 4.5 B in cuts. Who eats the other 2.3 B? Heck things could be worse, LA county just voted in a 1% increased sales tax. That’s 11.25 cents of every dollar.
November 6th, 2008 at 1:21 pm
OH HELLS NO!!!
November 6th, 2008 at 1:23 pm
If Arnold would to cut off ALL subsidies to the illegal population I would be more able to agree with this. Until then no way.
November 6th, 2008 at 1:23 pm
Bob Dole:
The people don’t enforce the laws on the books. That’s the government’s job. If the government didn’t enforce breaking and entering laws you’d have to stay up all night to protect your home. Don’t you understand that? The government ENCOURAGES lawbreaking by NOT enforcing our laws, just like they have failed to do with immigration!
November 6th, 2008 at 1:24 pm
Though many people get back nearly all of the taxes (state and fed) that they pay (some even get $ they didn’t even pay = earned income credit), we do not. And this RINO wants to increase our sales tax, too? Looks like my husband and I picked the wrong time to think we could afford to finally start a family. . .
There is a shortfall of $11 billion and they only have $4 billion of “difficult” cuts. You know what will be really difficult? Having to find a way to stretch my family’s budget even more (now that we added a little one). How about the state makes more budget cuts instead of reaching into my family’s wallet?
November 6th, 2008 at 1:26 pm
We desperately need our police, firefighters and teachers. I want more responsible spending and harsh review of spending but I am so tired of all the years of budget crisis. I am willing to pay the higher sales tax for the 3 years, but if we have to feel the pain of cutting back. The programs and gov’t spending better feel the pain too! But not at the cost of our necessary services.
November 6th, 2008 at 1:28 pm
Why don’t we cut out spending for illegals and their children! That should almost balance the budget in and of itself. Remember in the 70’s when sales tax was “supposed” to be a temporary tax? Well, 30+ years later its still here and going higher and higher. CUT spending, and stop taking the money from the tax paying “legal” citizens!
November 6th, 2008 at 1:29 pm
We are being lead by a bunch of idiots that make the 3 stooges look like Harvard Grads.
Consumer confidence is low. People are reverting to survival mode doing away with many if not most discretionary spending and your answer is raise taxes??????????????????????
November 6th, 2008 at 1:31 pm
According to the governor’s plan, the higher sales tax would end in three years…
yeah, sure. We all know that it will not end in three years. And why not raises sales tax, ’cause when the price of everything goes up, so do peoples wages. lol Give me a break!!
November 6th, 2008 at 1:34 pm
How many more bad decisions can Arnold make and make us pay for his mistakes!! My company is cutting our budgets, laying off left and right (every other week) but our corporate officers are still spending money like mad just like he is!! What is wrong with this picture!!! Shopping? Sorry kids, we are going to have an old fashion Christmas (the way it should be: Grateful for what we have not what we give or take.) I fit the middle class and I refuse to pay that percentage just to give to the rich. I’m barely surviving as it is.
November 6th, 2008 at 1:35 pm
Arnie on steroid again???
November 6th, 2008 at 1:35 pm
With that high of a sale tax I would not purchase anything. I will keep my car till the wheels came off. Only purchase a used junker if needed. Limit eating out. Purchased needed items from vendors that don’t charge for sales tax on the internet. Many people and business will move out of state. This will create excessive unemployment in the two digits. Those winnies running the State don’t think this will happen? Now everyone aren’t you just happy you voted in the 10 Billion Rail bond? Guess who pays now!
November 6th, 2008 at 1:36 pm
I have a solution: Buy online and out of state items that will not perish like food. As for food, nothing wrong with growing your own and it is a healthy choice. By the way folks, Obama has not even taken office yet and already here we have one of MANY tax hikes. I did not vote for Obama nor did I vote for Gov. Arnold Schwarzenegger. I think anyone that voted for either one should be the hardest hit because you chose these two morons. The sad thing is that we ALL suffer for the idiot votes out there.
November 6th, 2008 at 1:37 pm
Hey Sac