Newsom Said He Wouldn’t Raise Taxes To Fix California’s Deficit. His Budget Proposal Includes $18 Billion in Tax Hikes for Businesses.
Susannah Luthi
May 20, 2024
California governor Gavin Newsom (D.) told reporters earlier this month he wouldn’t raise taxes to fix the state’s $73 billion budget hole, but buried in his latest budget proposal are $18 billion in temporary tax hikes for businesses.
Earlier this month, the governor repeatedly pledged he would not raise taxes to solve the budget crisis—which comes just two years after he boasted a nearly $100 billion surplus—telling reporters that "the answer is no," should Democratic lawmakers bring him tax hike proposals, and that "there’s only so many times I can say no to the tax question."
"I don’t see there’s real evidence and need right now to increase general taxes … in this state and put more burden on working folks and our competitive posture," he told one reporter who asked him if tax hikes were an "absolute nonstarter" for him.
Newsom unveiled his budget proposal on May 10, and the tax policy details the following week. The proposal would, for the next three years, bar businesses earning $1 million or more from deducting operating losses from their taxes while also limiting business tax credits. The provisions are projected to cost California businesses about $18 billion through 2027, although they wouldn’t take effect if tax collections beat expectations. Such a scenario appears unlikely, however, given that California’s tax revenues are massively down thanks to a stagnating economy and exodus of both high-earning residents and businesses.
https://freebeacon.com/california/newsom-said-he-wouldnt-raise-taxes-to-fix-californias-deficit-his-budget-proposal-includes-18-billion-in-tax-hikes-for-businesses/
