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.
“’The vast majority of kids in poverty live in working families,’ said Alissa Anderson, senior policy analyst at the California Budget & Policy Center. ‘More than eight in 10 children in poverty in California live with at least one adult who is working.’”
There are a few ways in which the state can pay for expanding coverage, said Scott Graves, director of research for the nonpartisan California Budget & Policy Center. Policy makers could use revenue from the general fund without a tax increase, just as they did when they expanded Medi-Cal to undocumented children in 2016.
To get out of poverty, a family would need to be self-sustaining with an income that adequately covers housing, food, clothing and child care. Researchers at the California Budget & Policy Center estimate that would be between $45,000 and $50,000 a year for a family of four in Merced.
“’Our analyses show that we need policymakers to do more for people who are struggling to get by,’ Alissa Anderson of the California Budget & Policy Center explained. ‘Part of the problem is our cost of living is so high in California and rent far outpaced workers’ earnings. That’s made it really hard for families to make ends meet.'”