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Legislature Set to Adjourn without Voting on Wealth-Tax Proposals

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Monday, August 31, 2020   

SACRAMENTO, Calif. -- The California Legislature is expected to adjourn tonight without voting on bills to raise taxes on the wealthy, disappointing advocates who had hoped to avoid massive budget cuts.

By law, California cannot run a deficit, so without new revenues, billions in cuts to state services and agencies may be triggered this fall and next year.

Mike Herald, director of policy advocacy for the Western Center on Law and Poverty, said the bills would have raised an estimated $23 billion, funds he said are needed to prevent widespread suffering, on top of the chaos already wrought by the pandemic.

"These matters would prevent devastating cuts to things like the K-12 system, to child care, Medi-Cal benefits, in-home supportive services, welfare," Herald said. "Recessions often cause us to cut when we probably need to be paying out the benefits at the highest level."

Opponents of taxing the rich say tax increases would cause high-income families to flee the state.

AB 1253 would increase taxes by 1% on income over $1 million a year, and AB 2088 would add a .04% tax on personal wealth for couples making more than $30 million a year.

The bills' supporters vow to try again next session.

Instead, state leaders are calling on the U.S. Senate to pass another stimulus bill with billions of federal dollars to plug holes in state budgets.

But Christopher Calhoun, communications coordinator for the Service Employees International Union-California, said he isn't optimistic, because Senate Majority Leader Mitch McConnell has criticized the idea of helping the states.

"We're relying, as a blue state with clear-eyed leadership, on Mitch McConnell and Donald Trump to come to our rescue, and I cannot believe that that's our strategy," Calhoun said.

The coalition known as Commit to Equity says they'll press for a special session in the fall to deal with the fiscal cliff.

The coalition includes groups focused on health care, environmental justice, education, immigrants, labor, poverty and more.


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