Tax Commission Still Requires Vigilance

The California Commission for the 21st Century Economy was created by the Governor and Legislature in October of 2008. Its main purpose at least that which was represented to the public was to deal with the real issue of California’s revenue volatility. By now almost everyone knows that California is overly reliant on the income tax to run the state and because of its steep progressivity we are even more reliant on a handful of the "evil rich" to pay the lion’s share of that tax. (Of course notwithstanding this reliance our elected leadership still goes out of its way to drive these rich folks out of California to places where profit and success aren’t dirty words.)

Days after the Commission was created this columnist wrote a piece ringing the alarm bells. At the time none of the commission members had been selected but the real concern was that all twelve of the Commission members were to be selected by individuals — the Governor and Legislative leaders — who had just actively pushed for massive tax increases. Without quality taxpayer representation the commission would have zero credibility.

Ultimately the appointees to the commission reflected a diverse cross section of political views. Sure as a body the Commission probably balances further to the left than where the average California taxpayer would like. But with fiscally responsible members such as Curt Pringle the Mayor of Anaheim and some folks from the Hoover Institution at least those who pay the bills have a margin of representation.

But the Commission — which has already blown through two deadlines to complete its report — also has its share of uber-liberals. Members like former legislator Fred Keeley who unabashedly has a pro-tax agenda. In addition to pushing for a "carbon tax" he also is seeking an amendment to Prop 13 which would increase property taxes on businesses.

The Commission will report its findings in September and the Governor has already called for a special session of the Legislature to consider and act on its findings. This is probably a mistake as it would be better to see the report first. Calling a special session sets up the expectation for action when in all likelihood there will be no agreement on the commission’s recommendations.

Our primary concern of course is that calling a special session in advance will put pressure on the Legislature to compromise. Well we’ve seen compromise in California when it comes to taxes and we don’t like it. It was a "compromise" measure in February that socked Californians with the largest tax increase ever passed by any statehouse in the history of America. Over the last three decades California taxpayers have been "compromised" into shouldering one of the highest overall tax burdens in the nation if not the highest.

It is therefore critical that taxpayers remain vigilant to make sure that when the Commission’s report is released taxpayers won’t be asked to be bled a little more. That’s no compromise at all.

Jon Coupal is President of the Howard Jarvis Taxpayers Association — California’s largest taxpayer organization — which is dedicated to the protection of Proposition 13 and promoting taxpayers’ rights.