On Tax Day, many Californians are realizing how the Trump plan’s cap on itemized deductions for state and local taxes at $10,000 a year impacts their tax return. In states with high housing prices like California — and thus high local property taxes — it means that lots of people can no longer write off all of their local and state taxes and thus have to pay more to the IRS. It’s blatantly unfair. That’s especially true given the fact that large corporations haven’t been paying their fair share to California for a long time. Since the 1970s, corporate tax revenues as a percentage of California’s budget have plummeted more than 40 percent and are at near-record low levels, according to the California Budget & Policy Center.
As Californians scramble to submit their personal income tax returns before the Tax Day deadline, we at the Budget Center think this is the perfect time to take stock of how the state’s tax system performs on two key parameters: its ability to raise sufficient revenue to support public services, and how fairly it raises […]
This guide provides an overview of how earned income tax credits (EITCs) support families, children, and communities; examines key features of the California Earned Income Tax Credit (CalEITC); and shows how Governor Gavin Newsom’s 2019-20 budget proposal to significantly expand the credit will impact state residents with low incomes.
“If people want to call what California is doing socialism, fine, but it isn’t having a negative impact on the economy,” says political scientist Chris Hoene, executive director of the California Center for Budget & Policy. “By just about every measure of productivity, we’re at the upper end of the spectrum.”
At the end of 2017, President Trump signed into law the Tax Cuts and Jobs Act (TCJA), passed with solely Republican support in Congress. As the Budget Center has previously noted, the TCJA — the most extensive revision of the tax code since 1986 — primarily cuts taxes for the wealthy and corporations while increasing […]